When you are looking to purchase a practice there are certain aspects to think about:
1. You need to know what type of practice you're looking for: Are you looking for a large practice with associates or are you looking to be an owner/operator and purchase a solo practice which you can run on your own. Are you flexible on this? What is your management experience and experience running a business? The bigger the business you purchase, the more “moving parts” there can be.
2. Where are you looking to purchase a practice? What are your lifestyle needs? In the major cities there is major competition for most practices. This means higher costs. Are you willing to move outside of the major cities where there is less competition and therefore often lower appraised prices for generally the same practice? This would involve relocating yourself/your family or there would be considerable commuting each day. It is important to weigh both the pros and cons as they relate to you and your family, as well as your overall career plans.
3. How much are you willing to spend? And would you be comfortable with that amount of debt? A business can be fluid, and change from year to year. Ensure you are comfortable with the debt load you will be entering into based on your offer, especially when in a competitive practice purchase situation to which you may offer above appraised value.
When you have decided on the area that you're interested in, it is wise to explore all the different avenues to purchase a practice. One should search the different brokerages, magazines, as well as online classifieds through organizations and associations in order to fully explore what is available. No one specific source has information about all the practices for sale.
It is now a sellers’ market and there is tremendous competition for good practices in most areas that are not considered very rural. It is important for you to be prepared and understand this going in.
