David King, DVM, CVA Simmons Southcentral
Okay, you’ve made the big decision to sell your practice. Now what do you do? The following is a brief checklist that might help.
- Establish a ‘Fair Market Value’ – This is best done by a professional. Most veterinarians do not possess the skills to properly value their own practice. A professional appraiser can give you a value that is realistic in today’s market and tell you what to expect once the practice is placed for sale. This is the time to make solid business decisions and not be controlled by emotions. We often think our practices are more valuable than they really are. This is where a professional appraiser can bring us back to earth. Also, if you plan to try and market the practice yourself, it is important to have the credibility of a professional appraisal to help support your practice value.
- Consult with advisors – Once you have a fair market value, then you need to consult with your financial advisors about the consequences of selling your practice. When you have all the information about taxes and other liabilities . . . then you can make the final decision whether to proceed with the sale or continue to practice. Again, this is where a professional appraisal can help. If the after tax income from the sale is not what you need, then the appraiser can often show you areas that could be improved to increase the value of your practice.
- Decide how to market your practice – There are basically only two choices: market it yourself or hire a broker. Again, you need to be informed in order to make the best decision for you. Selling it yourself is very time consuming and can be very complicated. A broker will charge a fee, but he or she will do all the work, making your life a lot easier. The benefits of having a broker over selling the practice yourself is a subject that will be addressed in another article.
- Sell your practice