Buy a Practice
At some point after their graduation and internship, most veterinarians will make a decision as to whether or not they should buy a practice. Our role is to assist in the process.
When evaluating a practice, there are 3 key points to keep in mind:
- Type of practice
- Cash flow
Just as in real estate, the mantra “location, location and location” applies to the buying a veterinary practice. For most veterinarian, the choice of where to buy a practice also means making the decision as to where one will live. Thus, the community will not only be the business model you wish to pursue, but also the lifestyle you desire.
The Type of Practice
Not every practice is the same, and this fact should be a major factor in your decision making process. Companion, mixed or large, will determine the type of veterinary medicine you will be practicing.
While it may be possible to change the practice model in the future, most buyers wish to buy the practice model in place and not go through the process of revamping it. Yet, a great location will allow the new buyer to revamp the practice model type and develop the perfect practice as a result.
As with any business, cash flow is vital and makes the difference between success and failure. This means that when a buyer is considering a practice, he or she must be certain that the practice will be able to produce sufficient income for its operation now and in the future.
Key Fact-Cash flow is the number one factor that will determine the practice value. More importantly, it will determine how the underwriters at a financial institution view the loan.
Remember, purchasing a veterinary practice is an income-producing investment and differs tremendously from the purchase of a home or even a dream home. Purchasing a lucrative veterinary practice is a tremendous investment opportunity and must be treated as such.