Chiropractic Practice Value

How much will it cost?
Will the seller expect a cash sale?
What is my assurance the clients will stay?
What will prevent the seller from opening a new practice close by or going to work for another doctor within a few miles of this practice?
How did they arrive at the selling price?
How long should I expect the selling doctor to stay with me?
Am I expected to take responsibility for the selling doctors problems?
The answers to these questions are very important to the prospective buyer as well as the seller.

As Oak Tree Associates has over twenty years of experience in the selling of chiropractic practices, we are in a solid position to answer such questions listed above as well as other questions that may arise when buying and selling chiropractic practices. We would like to take this opportunity to define some of the normal parameters followed in chiropractic practice sales. There are some exceptions such as seller not available for a normal transfer period or the practice not having it's own office.

Chiropractic practices usually sell for their last twelve months net collections plus a value for the practice equipment. The last twelve months net collections is found by taking the last twelve months actual gross collections and subtracting the actual cost of running the practice during that period. Most buyers would expect that the net thus found would be consistent with the results of the practice over the last two years. It should be noted that at some time in the sale process before the sale closes the buyer will expect to be shown, to the buyer's satisfaction that the seller really did collect the gross amount represented and is shown the actual costs in operating the practice. In order to verify the claims made to buyer by seller as to the net, the seller will have to produce bank statements and tax returns as well as patient files with billings and visit logs.

A chiropractic sale is usually a cash sale. The buyer is expected to have the cash or arrange his own financing. As to the protection of the buyer in buying the practice, the first and foremost protection is making sure that the practice is as the seller said it is. Doing a thorough review of the practice patient files, bank statements and tax returns is absolutely necessary before the sale is final.If such records are not reviewed the buyer is just asking for a disaster. As a buyer you should always remember that a practice that did $120,000.00 in the previous fourteen months but is doing $2,000.00 a month in the last two months is on track to be a $24,000.00 a year practice. A good sales agreement is the next level of protection for the seller. Oak Tree Associates has spent twenty years continually updating it's sales agreement which it uses for it's sellers. It has been developed to protect both the buyer and the seller as any sale that only serves one party in the transaction is a bad sale. Our sales agreement contains many protections for the buyer in regards to the seller practicing near the buyer or servicing the clients included in the sale. The sales agreement is over seven pages long and contains many protections for both the seller and buyer. It makes sure that a reasonable transition time is spent by the seller with the buyer. This usual time is thirty days after the sale closes.
Please call for additional information.

OAK TREE ASSOCIATES Phone (800) 233-0659 FAX (949) 855-9648