Veterinary Practice Ownership is Still a Good Decision Today
Buying a practice is still a smart move even during the COVID-19 pandemic. There are a few extra things to consider though.
First, how have the practice restrictions set in place by the state’s Governor impacted practice revenue compared to the same time period last year? TPSG is seeing revenue of many practices down 10-15%, others are flat, and believe it or not, some are above last year’s revenue. If you are looking at purchasing a practice be sure to get financials, such as a profit and loss statement, for 2020 as compared to last year.
Second, lenders are still financing acquisitions at good rates, however; lending criteria has tightened somewhat. The banks are looking at 2020 financials critically with regards to short term practice stability for the buyer and the buyer’s ability to manage cash flows and debt service.
Third, practices are operating differently and less efficiently today than in the past. Many are doing “car appointments”, limiting the number of clients in the waiting room (if any at all, as in Michigan at the time of this writing), and implementing procedures that are more costly and take extra time to protect clients and staff from possible Corona exposure. These changes bog down the system and limit the number of clients that can be seen per hour.
Even with these additional provisions, the benefits of practice ownership still hold today. Practice ownership provides you with:
- Job security, insofar that you can never be “let go” by management
- Opportunity for you to lead the practice in the direction you think is best
- Office hours of your choosing and control over how much time you spend seeing patients
- Freedom to set all the office policies, fees and decide what equipment is best for the practice
- The potential to purchase the real estate as an added investment
- Building equity which is generally greater than other investments
- Ability to build the best staff and eliminate any “bad apples” – while many times this is not an enjoyable task, at least you have control over it.
- The ability to make more money than you currently make as an associate doctor.
If these benefits are of interest to you, please contact the TPSG representative in your area for a free consultation about practice ownership and opportunities that are available for you.
Kurt D. Liljeberg DVM
Total Practice Solutions Group
Great Lakes Region