OPTIMIZE PRACTICE PROFITS TO SELL
Optimize Practice Value to Sell
VET PRACTICE M a r k e t p l a c e®
The DVM Success™ Vet Practice Marketplace is reinventing the vet hospital sales process, leveraging the power of group sales to get you the best buy-out offers.
“You should always be running your business like you are selling it even if you are not. This helps to keep your practice optimized for when the time is right for you. You will also make more profits along the way until you are ready and you will get some offers to consider, just to get a sense of what the market will bear.”
The first step is understanding what your practice value is, and then doing everything you can to create the optimal balance sheet. You want to maximize your EBITDA (which is an acronym for Earnings before Interest, Taxes, Depreciation and Amortization) otherwise known as cash flow.
This unique marketplace allows anonymity for sellers who join with other vet practices. By joining a pool of sellers, you attract buyers who will pay a higher multiplier of your EBITDA than most practices can negotiate by themselves. “All boats will rise”. Owners receive multiple offers with minimal effort and are in complete control, choosing when to participate further in the sale of their practice.
The process is simple. Buyers complete a simple form on the demographics they are seeking. Those practices matching that demographic profile are contacted and if they accept they are grouped together in a portfolio. With the accepting individual practices’ confidentiality preserved, the practice submits two years’ worth of P&Ls (profit and loss statements). From these P&Ls each practice will have a formal EBITDA (earnings before interest, taxes, depreciation and amortization) or total cash flow number.
DVM Success will group all qualified sellers together adding each practice’s EDITDA together for a total EBITDA. This will then be presented to the buyer marketplace in a letter of intent (LOI).
Buyers then bid for a group of hospitals and are based on a multiplier for the group’s total EBITDA (cash flow). For example a multiplier of 5 times an EBITDA of $200K would be $1M. The group approach creates a multiplier factor that is higher than what it would be for a single practice purchase.
Offers are presented periodically, so owners can take advantage of an awesome sale price whenever they are ready to sell a portion or all their practice.
There is no obligation to sell. If you are interested in selling based on a given offer, then we provide more information to you on the buyer.
This represents the simplest way to receive real offers from multiple buyers for your practice and it is all anonymous. Buyers bid in auction, so you get the best price due to the bidding war and the leveraged power of the group to get the best offer possible. A more complicated financial term for this is arbitrage.
Our target sale price is over 11 TIMES the current value of your practice EBITDA. That is over 11 years of cash flow to sell your veterinary practice today.
Educational modules to help explain this valuation methodology as well as the advantages of group selling include:
- Understanding This Critical Metric to Valuation: EBITDA (Earnings
- Before Interest, Taxes, Depreciation, and Amortization)
- Overview of Earn-Outs
- Key Drivers of Practice Valuation
- Group Power on Practice Valuation
- Legacy Planning