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    5 tips to prepare for selling your practice

    Start formulating an exit strategy years before you plan to sell

     

    3. The last three years are all that matter.

    When a practice appraisal is performed, we look only at the last three years of financial statements and tax returns. Is the practice growing, declining, or maintaining at the same levels? Of course practice buyers like to see gross receipts trending higher each year. This scenario can lead to a higher multiple being used to value your practice. Declining revenues are often a red flag to prospective buyers and can make for a difficult sale. We do not recommend cutting back on marketing or office hours during the three years leading up to a sale—in fact, it could be very helpful to increase both.

    If you have more than one location, each office should have separate income statements. Get organized and use the help of your CPA if you have to and be sure to deposit all receipts into the bank so there is proof of 100 percent of income being reported. 

    4. Take a look at your office from the patient's perspective.

    Dirk Massie, OD
    Dr. Dirk Massie has two practice locations in the St. Louis metro area. He is the primary consultant at Premier Doctor Consultants.

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