Is It Time to Sell Your Practice?
Deciding to sell your practice is one of the largest financial and personal decisions you’re likely to undertake. Despite the highly personal (and slightly scary) decision to consider alternatives for your practice, there are numerous advantages to selling all or a portion of it. Specifically, a sale or partnership can allow you to monetize the years of investment that you’ve made in your practice, plan for succession, create room in your partnership structure for younger physicians, or partner with a larger group that can help to drive growth and provide additional back office support – allowing you to focus on your patients.
Whatever the reason you choose to explore a transaction, there are steps you can take early on in preparation for a sale or partnership in order to maximize value, options and opportunities both for you as an owner or partner and for your staff providers and employees.
Define your short and long-term goals, personally, professionally, and financially, for your practice. As you frame your thoughts, here are some important questions to think through:
- What is your Career Path: Do you want to practice medicine for a few more years . . . five to ten more years . . . exit as quickly as possible? This decision could influence the partner or buyer selection. The longer you intend to practice, the more opportunities will open up for you. Remember – at the end of the day – you’re selling a “people” business, and what has made your business successful and attractive in the past is the people – namely ¬you. Most groups will want a transition period with providers selling their practice and will want to have incentives in place that keep remaining providers happy and focused on providing high-quality patient care.
- What Objectives Matter Most to you in a Sale: Are you interested in maximizing the dollar amount for your practice? Finding the best cultural fit for your providers? Creating a legacy? Maintaining continuity of care in your community? Becoming a platform, which acquires other local / regional provider groups? Here too, the answers to these questions will influence the possible universe of buyers / partners with interest in your practice and how they value your practice.
- What is Your Process Execution Timing: Are you ready to go now? Are you more interested in pursuing a leisurely exploration of alternatives?
- How Might Other Partners or Providers View a Sale: Is this the right time for the practice to find a new partner? Are there emerging physicians that could be made a partner in the context of a sale? Will providers want to stay with the practice if it has a different ownership structure?
With these essential questions answered, look for next week’s blog explaining crucial next steps in realizing the goals for the next phase of your practice.