Doctors and lawyers who work for themselves in small practices generally find their work very rewarding. It is the ultimate blend between being a professional and an entrepreneur. For many who chose this route the goal is to hand the reins of the practice over to a child when ready to retire. That’s the ideal. But unfortunately, the reality is that in this day and age the tradition of a child taking over the parent’s business is becoming increasingly rare. Increasingly children want to follow their own path and do their own thing; which is great, but what does that mean for the practice you have spent your career building? Here are a few ideas to ensure that you don’t have shut it all down when you retire.
Find a specialist
In this instance the specialist that you need to find is not medical. Rather, when it is time to make your medical practice for sale know that there are expert brokers out there who specialise in matching sellers with potential buyers in the medical industry. It is a niche speciality, but the brokers know who is in the market for buying a practice and they will help marry your needs with those of somebody who wants to enter the market and take over a practice that is a going concern. If you don’t know a broker use the internet or speak to a colleague for a referral.
Whatever you do, make sure that you don’t end up wanting to retire without having thought through the implications. As you approach the end of your career it is probably a good idea to identify potential partners who might want to come in and work alongside you. If you can sell a share in your practice it means that you will ensure a smooth transition from one doctor to another. It will give you staggered capital injections as the partner would pay in a couple of tranches. It also means you don’t have to retire immediately and stop working. With a staggered take over you can continue to work and earn as a partner in the practice.
Know the value of what you have
So often doctors feel that the only value in their practice comes from the patients that they see. While the client base is definitely a major source of value, the assets of the practice are equally valuable and should not be forgotten. New doctors coming into the area undoubtedly want to take over an existing client base, but at the same time they also want value for money and would far rather not put themselves in a situation where they must set up their own practice from scratch. So, all your diagnostic equipment and the bits and pieces that you have assembled over the years must either be sold as part of the practice (if you sell it as a going concern), or if you are going to shut up shop, make sure that you get them auctioned or sold via a medical supplies business. If you have gradually accumulated equipment over the span of your career you might not realise quite how valuable all your assets are.