So You Want to Sell Your Practice?

Selling your business is one of the biggest financial decisions you'll ever make. And most owners approach it with an inflated sense of what their practice is worth - then get surprised when the market disagrees.

Start with a Valuation

A practice valuation is an opinion and should not be confused with anything concrete. Think of it like real estate: your home is worth whatever a buyer is willing to pay, regardless of what Zillow says.

That said, a professional valuation gives you a realistic starting point and - more importantly - tells you what needs to change if you want to command a higher price.

Work Backward from Your Number

Here's the question we ask every owner considering a sale: What is the price you're looking for - or need?

Once we have that number, we work backward. What revenue and profit margins does the business need to demonstrate to justify that price? What does the buyer's due diligence process look like, and will your financials survive it?

The typical timeline from "I want to sell" to "deal closed" is 12 to 18 months. That's not just finding a buyer - it's preparing the business to be bought.

What Buyers Want to See

Buyers - especially sophisticated ones - will scrutinize:

• Three years of financial statements (clean, consistent, and professionally prepared)
• Production and revenue reports (trending upward, ideally)
• Lease agreements (are they transferable? How much time is left?)
• Bank statements and cash flow (no surprises)
• Payroll records (stable staffing, reasonable compensation)
• Equipment lists (condition, age, replacement costs)

If any of these are messy, incomplete, or inconsistent, it costs you money. Buyers discount uncertainty - aggressively.

The Uncomfortable Questions

Beyond the financials, you need to think through:

• Post-sale employment: Will you stay on during a transition period?
• Staff retention: Will key employees stay after the sale?
• Lease transferability: Does your landlord need to approve the new owner?
• Non-compete clauses: What restrictions will apply to you after selling?

The Bottom Line

The best time to start preparing for a sale is years before you actually want to sell. Clean books, consistent revenue trends, and organized documentation don't happen overnight.

If selling is on your radar - even if it's three to five years out - start the financial groundwork now. The difference between a business that sells at a discount and one that commands top dollar is almost always preparation, not luck.