9 Steps to Prepare Your
Psychiatry Practice for Sale
Selling your psychiatry practice is a momentous decision that affects both your personal and professional life. It can be emotionally challenging and complex, but with careful preparation, you can navigate the process successfully. Here is a step-by-step guide tailored to help you get ready for selling your practice.
Define Your Objectives
Start by clarifying your reasons for selling. What do you want to achieve from the sale? Whether it is maximizing profit, ensuring your employees’ futures, facilitating a quick transaction, or securing your practice’s legacy, understanding your priorities will guide your decisions and negotiations.
Prepare Emotionally
Selling a practice you have built can evoke strong emotions. Recognize and prepare for this aspect of the process. Make arrangements for your team and plan your next steps. Consider seeking support from professionals to navigate the emotional challenges that come with letting go.
Organize Financial Records
Prospective buyers will scrutinize your financial history. Organize at least three years of financial records, ensuring they are accurate and easy to review. Clear financial documentation enhances your practice’s appeal and facilitates smoother negotiations.
Assess Profitability
Evaluate your practice’s profitability by documenting all non-operational and infrequent expenses from the past three years. This helps potential buyers understand your business’s true financial health and potential for growth.
Assemble a Support Team
While your attorney and accountant are crucial, consider involving a Merger & Acquisition advisor and transaction experts to manage the sale process effectively. Planning early allows these professionals to optimize your practice’s financial position and navigate legal complexities.
Get a Professional Valuation
Gain insights into your practice’s market value, strengths, and weaknesses with a professional valuation. Choose reputable valuation firms experienced in your industry to ensure accuracy and reliability in the assessment.
Gather Due Diligence Materials
Prepare comprehensive due diligence materials, including contracts and agreements with suppliers, landlords, and payors, insurance policies for the business, employee agreements, summaries of current litigation or legal disputes, leases for office space and equipment, and regulatory compliance records and licenses. Completing this step beforehand streamlines the sale process and demonstrates your practice’s readiness to prospective buyers.
Showcase Your Practice’s Strengths and Unique Advantages
Tell the story of your practice’s success and outline its unique strengths and achievements. Highlight specialized treatment programs, positive patient outcomes, community reputation, and innovative healthcare initiatives. Show potential buyers why your practice stands out in the market.
Identify Potential Buyers
Collaborate with your M&A advisor to identify financial and strategic buyers interested in acquiring your practice. Casting a wide net often uncovers buyers willing to offer competitive valuations based on unique motivations. Engage your advisor to initiate discussions with potential buyers.
About Tony Siebel and Olympic M&A
Tony Siebel is the Managing Director at Olympic M&A, specializing in selling behavioral health, medical aesthetics, ophthalmic, and physician-owned practices to private equity and strategic buyers.
For personalized guidance on preparing and selling your psychiatry practice, contact Tony Siebel, Managing Director at Olympic M&A. Reach out at 502.360.8320 or email tonys@olympicma.com. Connect with Tony on LinkedIn: linkedin.com/in/tonysiebel.