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It is our opinion that a specialty practice derives it principal value from the value of the facilities (leased or owned) and the skill and reputation of the specialist doctor. If the specialist attempts to sell the practice, he/she should only expect to be paid for the facility improvements and the equipment associated with the business. We contend that the patient records do not have a significant value. We also believe that while trained staff are valuable, they are not obligated to transfer with the sale of a business and thus the staff value is uncertain at best. When considering the value of your specialty practice consider what it would take for a doctor to obtain a list of referring doctors in the area. A search of the white and yellow pages and the internet would probably result in a list that was very complete with very little effort. We think that the reputation of the clinic is largely associated with the reputation of the specialist(s). If there are other specialists in the area, the referring doctors will choose to refer to the clinic with the best specialist(s). If a client is unhappy with a particular specialist, the client is likely to seek a different referral the next time. Also consider whether or a not-to-compete agreement is enforecable. If such an agreement is unenforceable, an associate can not be counted on to be available to a new owner. If a new owner is unacceptable to the staff or associates, the practice may not be "saleable" to the new owner at all. We have established written business policies that cover all aspects of how the clinic is run and descriptions of staff responsibilities. We also have client technical handouts that are copyrighted by us. All such material have value, but the prospective buyer may not have the same business philosophy and/or the same medical treatment beliefs. |
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