10 things to consider when selling a veterinary practice

When it comes to finding a veterinary business partner dedicated to supporting community hospitals, National Veterinary Associates (NVA) is an industry leader. Founded in 1996, NVA is home to a large community of independent veterinary hospitals that includes more than 14,000 veterinary professionals providing a full range of medical and surgical services.

Unlike a transaction between 2 people, NVA relies on 25 years of experience in national and international partnerships. This know-how gives NVA the unique ability to offer hospital owners the opportunities best suited to their needs. From cash offers to joint ventures and even future partner buyouts, NVA helps firms develop a plan that is as unique as they are.

“We believe veterinary medicine is best practiced when local vets develop their own approach. So when a hospital joins the NVA, we keep the culture, people and name intact, ”says NVA founder Stan Creighton, DVM, DACVIM. “We have created a community [that] people are proud to be a part of it, and we attribute that to the growth we are still experiencing today.

Hospitals that partner with the NVA gain knowledge of the NVA’s skilled support team and a network of successful practices. NVA resources include an information technology office, a customer service center for appointment reminders, and social media and online review experts. They also offer support for tasks such as accounting, legal, recruiting, marketing, and operations.

“It turns out that the NVAs were people of their word. They haven’t touched our culture at all. They improved our technology, helped us run our business and allowed us to practice medicine as we always have, ”said Dr. Jeffrey Krull, chief veterinarian at Flying Cloud Animal Hospital in Eden Prairie, Minnesota. .

“That’s what every doctor wants: to make these decisions ourselves. We don’t need an algorithm or a program to tell us what to do. Dr Jeffrey Krull has been a member of the Flying Cloud Animal Hospital team since 2002 and after the firm became an NVA Partner in 2008, he was promoted to Medical Director. In 2019, NVA helped Dr Krull achieve his lifelong goal of owning a direct-to-hospital practice he already knew and loved.

“I have wanted to own a practice since I started veterinary school. When NVA first proposed it, I was excited from the start. I knew they would be a good group to partner with.

If you are looking for a path to retirement, ready to step back and focus on medicine, or if you want to help your associates realize their dreams of owning a practice, a partnership might be the right one. choice for you. If you are ready for the next chapter in your life, be sure to take the time to explore all of the options available to you and ask yourself these 10 questions when considering selling your practice.

What do you want to accomplish with the sale?

Owning a veterinary practice can take its toll. Days off without thinking about staff planning or long-term goals are rare. Even if your practice is thriving, the commitment that comes with owning can eventually get too heavy, so the idea of ​​selling becomes more appealing. Obviously, the selling price is going to be a primary consideration; However, you should also explore all of the options available to you. Do you want a single buyer? Is there an associate you would consider selling or partnering with? Would your firm fare better with the support of a larger parent company?

Will you continue to practice?

It is important for practice owners to determine whether they want to retire after the sale or whether they prefer to continue working. Selling a practice doesn’t mean you have to cut all ties. In fact, it’s common for former practice owners to stay on board after a sale. Do you want to work only a few days a week? Do you want to transfer all business operations and focus only on the practice of veterinary medicine? Are you planning to phase out the business after a few years? These are all key points that need to be clarified at the early stages of negotiation to ensure a smooth transaction. Remember that you are in control of the terms of your sale and those decisions are yours. Don’t settle for a buyer who might try to convince you otherwise.

Have you thought about the emotional impact of selling?

You have undoubtedly devoted a lot of time and passion to making your practice the successful and trusted part of the community it is today. Are you ready to relinquish this role? And if you continue to work in the hospital, are you ready to work for someone else? Selling a practice is multifaceted. As excited as you are, take the time to fully understand the emotional implications of the decision so you don’t get caught off guard along the way.

How will your staff be impacted?

While your hospital staff may not be aware of all the details of the sale, you will need to have an honest discussion about the sale and provide a general timeline of how things will progress in the weeks or months to come. .

Are all your financial and legal documents in order?

Be as prepared as possible to avoid setbacks or delays during your hospital’s sales process. Make sure that key documents (partnership agreements, licenses, ownership records, leases, supplier contracts, etc.) are accurate and readily available.

Would you like to improve your practice and develop your team?

Selling your veterinary practice through a partnership agreement could provide an opportunity to upgrade equipment and services while simultaneously growing the business. Forming a partnership with a larger group of practices provides community hospitals with access to a network of health professionals to share key ideas and learnings.

Which is the right partner for you?

Of course, someone with the financial means to purchase your practice is a necessity, but there is a lot more to consider. You have built your practice to be an integral part of your community; it is important to ensure that the reputation continues. Take the time to explore all of the options available to you and don’t feel like you have to jump to the first offer. Look for a buyer who is open to negotiations and provides feedback. In addition to the terms, think about how the buyer will handle the transition process and employee well-being.

What contingencies are you comfortable with?

Often, purchase and sale contracts include pre-closing contingencies that must be agreed upon. Your associates may be asked to sign pledges to stay with the practice for a minimum amount of time after closing. Another could be that the buyer can negotiate a lease for the use of the property from the seller or the owner from the seller. Contingencies vary from transaction to transaction, but familiarizing yourself with some of the more common demands can ease future shocks.

Do you know the value of your practice?

You have shed a lot of blood, sweat and tears in building your practice, but these sacrifices are priceless. There are, however, finite factors that will help determine the listing price. These include the practice itself, equipment, and current and potential income. Prospective buyers will also take into account gross income, income statements, net operating income, EBITDA (earnings before interest, taxes, depreciation and amortization), profit margins and various other financial documents and references. Consider what your practice has to offer and what changes could lead to an increase in its value.

Are you ready to begin the planning process?

Even if the thought of retiring has not crossed your mind, you may find it interesting to explore the idea of ​​a partnership a little more. Working with companies like NVA offers hospitals a plethora of opportunities. Your veterinary practice is probably one of the most important investments, if not the the biggest you have ever made. Treat it like one by regularly monitoring its value and exploring new avenues for growth.

Selling should never be a rash decision, and no one knows your hospital, clients or staff better than you. Weigh the pros and cons of each possible trade that comes up to determine if this might be the right choice for you.

NVA is a premier veterinary community of independently run veterinary hospitals providing specialist, emergency and general medical care, all united in the love of animals and the people who love them. NVA champions the unique culture and opportunities of each hospital by enabling innovation, collaboration and a commitment to provide exceptional care for pets and their families. For more information, visit nva.com

About Hector Hedgepeth

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