Buying and Selling an Established Chiropractic Practice

The method by which you negotiate the buying or selling of a chiropractic practice is dependent upon a few simple, but sound principles.  It is well worth spending time researching before outlaying what could be a sizeable amount of money.

It can provide a great opportunity to buy an already established practice with its inherited base of old patients and steady stream of new ones.  As with any small businesses, one of the most difficult parts is starting from scratch, i.e. no equipment, little money and, most important, no patients.

A common opportunity for a chiroprator to consider buying a practice arises when a practitioner has been practising for a few years in a partnership arrangement and he/she wants to buy out the other partner.  Another case is when a new graduate or a practitioner after being practice several years considers a new location due to a practice for sale opportunity, in a different area.

There are four parts to the equation in trying to establish the actual worth of a practice:

1. Market value of land and building/lease arrangement
2. Equipment value
3. Outstanding accounts
4. Purchasing the good will

Other conderations

Change over: letter informing patients of change over in 6 - 8 weeks before actual change (most important). 

Technique: The new chiropractor, (even if he/she does not practice the same technique as the previous chiropractor) should be familiar with the previous chiropractor's health care approach.

Philospohy and type of practice

Areas that need to be considered are:

. Model -  Biomechanical/Vitalistic
. Nutrition - Are vitamins/minerals prescribed and if so how frequent
. Average number of visits per new patient
. Length of time per treatment visit
. Are several rooms used simultaneously/one room for treatment
. Are x-rays used

 
Buying and Selling an Established Chiropractic Practice

1. Market Value of Land/Building/Lease Arrangement

. 2 - 3 opinions/quotes from estate agents wil give you figures to work from

2. Equipment Value

. Fair market value
. Practice - engage service of x-ray supplier, chiropractic equipment supplier for appraisal of equipment at fair market price

3. Outstanding Accounts

. Find out how much is owed
. If not more that £2000 - £3000 this could be worked into the overall price

4. Good Will

. Based on enclosed formulas including how to buy and sell a practice (see attached sheets)

Formula's for finding out the true worth of a chiropractic practice

  x 4 =   + 20% =    

or

  x 2 =   + 10% =

alternative

Average office visit £30

Say the number of new patients in 12 month period 300
(5 visits is taken as option number)