Considering Practice Ownership in the Modern Market
Just like with home ownership, young veterinarians are walking into a completely different market than even the previous generation saw upon graduating from vet school. Nowadays, the ability to buy your own veterinary practice requires more than just the desire. But have no fear, the knowledgeable team at Total Practice Solutions Group is here to help you make a plan to owning your own practice and securing your financial future:
Learn About Financing Options
Many younger veterinarians are completely writing off practice ownership because they do not feel like they could get approved for a loan. Contrary to popular belief, however, there is a lot of available financing for veterinary practices and it is not as difficult to obtain as some might think. For example, student loans and other loan debt will not affect one’s chances of approval. Talk to your TSPG broker about financing options and how you could potentially own your own practice sooner than you think.
Decide if Buy-In or Buy-Out Is the Right Option for You
Buy-In: If you are not ready to go all-in on your own practice, you can find the option of an associate buy-in where you buy a portion of a practice from a single owner. The buy-in agreement can include language about future buy-in options where you can become the sole owner after you’ve had the chance to build some equity.
Buy-Out: When you buy-out a practice, you are purchasing 100% of it. This allows you to potentially inherit a full staff and a practice that already has a big client load so you are not starting with nothing as you begin your journey into practice ownership.
Think About Veterinary Practice Considerations
The physical location and condition of a veterinary practice are important factors to consider before making the decision to buy. As you work with your TPSG broker to find a clinic that meets your vision for your practice, be sure to consider:
- Location: Don’t forget that your practice location will affect your living situation, so be sure to take your time to find a location where you can live comfortably and do not have to spend hours a day commuting to and from the office.
- Type of Practice: Think about the type of medicine you want to practice and find a veterinary hospital that is already equipped to handle it. Although it is not impossible to add more services in the future (like outfitting a space for larger animals when it was previously used for companion animals), but it is much easier to buy a practice that already practices the kind of medicine you wish to do.
- Cash Flow of Practice: Cash flow is one of the most important considerations of a potential veterinary purchase. If a clinic is not currently bringing in enough cash to keep the business running or to give yourself a paycheck, it is extremely unlikely that it will start to generate enough in the near future.
Total Practice Solutions Group is here to help you with every step of buying or selling a veterinary practice. Our team has the experience and knowledge necessary to make the best deal for your needs. Contact us today to learn more.