Today's Veterinary Business

AUG 2018

Today’s Veterinary Business provides information and resources designed to help veterinarians and office management improve the financial performance of their practices, allowing them to increase the level of patient care and client service.

Issue link: https://todaysveterinarybusiness.epubxp.com/i/1007483

Contents of this Issue

Navigation

Page 18 of 75

— ever. This could present a great opportunity for you: a long-term tenant. However, if the consolidator decides to, well, consolidate your practice with another hospital, you could be left with an empty building designed for a highly specific use. Are You Flexible? Consolidators have standard con- tracts and common compensation and benefits plans. Sellers who stay with the practice — a corpo- rate buyer could require it — might lose the ability to take frequent vacations or destination continu- ing education courses. When you are accustomed to setting your own fringe benefits, the switch to a compensation package with finite terms can force a lifestyle change. When an associate veterinarian buys the practice, the seller usually has a greater ability to negotiate the most important benefits. An Easier Transition Selling to an associate presents fewer unknowns. Face it, your staff might be pleased to hear that you sold the practice for a high price, but what they really want to know is how the sale will affect them. Will they still have jobs? Do they have a new boss? Who makes decisions that affect them? When an associate buys the practice, your staff knows the buyer and might have some insight into where changes will and won't be made. The doctors won't expect significant changes to the standards of care or general operat- ing procedures. Overall, selling to an associate creates much less anxiety for others in the practice than sell- ing to a consolidator does. A Shorter Transition Some sellers stay on for years after the sale, but the time is usually much shorter. You need to stay long enough to transition your personal goodwill to the buyer. When you sell to an associate, the process is al- ready underway. Actively participate in this process by reiterating your confidence in the buyer, particularly when you see clients who are close- ly bonded to you. While you may want to keep special clients for your- self, they need to be comfortable seeing another doctor. Otherwise, they might see your departure as an opportunity to visit a competitor. Be sure to quickly transition the practice management responsibili- ties. When an associate veterinarian buys your practice, she will take the reins. She will need to learn, if she hasn't already, how to handle staff issues, client complaints and other "joys" of ownership. You can hang up your owner hat and focus on seeing clients. In other words, you get to be "just a doctor" while you remain with the practice. The new owner might ask for your advice, but don't be sur- prised if she doesn't. It's her business now, and while she is learning to lead, she may not want your input. Your Legacy Selling your practice to a consol- idator might bring you a higher purchase price, but when it comes to preserving a legacy, selling to an associate is hard to beat. So consider this. A corporate player is looking for practices that are profitable and growing and that fit into their investment sweet spot. Many will appreciate the atmosphere and clientele you created, but their ultimate goal is to make as much money as possible from the prac- tice. This is a characteristic of true investors and isn't a bad thing. A veterinarian considering a purchase wants to make money, of course. But she also is buying a ca- reer in veterinary medicine. The typ- ical veterinarian isn't looking for the fastest way to get a return on her money. She wants to find a good fit where she can practice the kind of medicine she wants to provide. When an associate veterinari- an, or a practice manager for that matter, wants to buy your hospital, it is because the practice fits with her core values and she wants to maintain and advance its place in the community. She wants to buy your practice specifically. Money Matters columnist Leslie A. Mamalis is the owner and senior consultant at Summit Veterinary Advisors. Learn more at www.summitveterinaryadvisors.com.

Articles in this issue

Links on this page

Archives of this issue

view archives of Today's Veterinary Business - AUG 2018