PRACTICE FOCUS Is the practice more acute-care-focused or more wellness-focused? Acute care practices require more new clients to sustain volume. As a result, they generally have a higher new client acquisition cost which factors into the ability of a new purchaser to reproduce a similar profit margin. A wellness-focused practice of-ten has a higher patient visit average (PVA) which may mean less effort to maintain the existing practice numbers. benefits of chiropractic care generally are more sought after. SYSTEMS CLIENTELE A more diverse or generalized client demographic will increase the pool of potential purchasers, versus having more of a niche in the community. For example, focusing purely on pediatric, sports or a specific ethnic clientele will limit the number of purchasers that are willing to buy a practice they may not feel strongly suited to. Offices that have clearly defined financial policies that are reviewed with clients and that have structured education systems that communicate the health and function Offices with well-structured operating systems that are team-focused rather than doctor-focused are more reproduc-ible. Evaluate this is by reviewing your operations manual. An office with a written marketing plan that adapts it accordingly and tracks return on invest-ment on efforts expended is more attrac-tive to potential buyers, as they can simply follow the plan to recreate current practice volume. PASSIVE INCOME Goodwill can be increased when an office has reliable passive income streams – such as allied health-care professionals, rehabilitation area and nutrition – that are systematized in a way that requires little effort to repro-duce cash flow. DIGITAL WORLD Offices that have embraced the electronic era increase their saleability. Today, buyers are looking for offices that have effective and updated web-sites with reputation marketing systems built in. It doesn’t take much imagina-tion to see how a reputation marketing system that has significant numbers of positive reviews can impact the good-will of a practice. In contrast, poor reviews can weaken your goodwill. Other factors that have the ability to influence the valuation of a practice include the geographical location of a practice, percentage of overhead, whether a practice is declining or grow-ing, and whether there is real estate available as part of the purchase. Now that you rated yourself in each item, you have given yourself a tem-plate on what you need to work on. Any area scoring below a seven or eight probably needs work. Applying some energy into these areas will more than likely produce immediate results for your bottom-line and also provide a healthier selling price for your practice when that time comes. Resource Directory www.canadianchiropractor.ca September 2015 Canadian Chiropractor 29
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