#1 Rated Clinic Owner Blog

Over the summer, I was invited to participate at Deloitte’s Entrepreneur summit in Texas. It was so cool to meet and talk with over 400+ of the most innovative entrepreneurs and private equity firms in the world.

One thing that really stood out was the discussion around high interest rates. They're shaking things up, particularly for those looking to sell their clinics. Bain Company's forecast? A staggering 41% drop in global deal values for 2023 compared to 2022. This is big news for clinic owners like us.
 
What this means is buyers are treading more carefully than ever. If you're considering selling your clinic, it's vital to make sure every aspect is on point to secure the best deal and the payoff you deserve. 

In this blog, you’ll learn the five different buyers who are making big moves and buying clinics strategically in 2024. As the market shifts, understanding these acquisitions is not just interesting but crucial for clinic owners who want to get the highest value they can.

There are many reasons why a clinic owner might choose to sell their clinic, be it a massage clinic, physiotherapy clinic, dental clinic, or chiropractic clinic.

But it might surprise you to learn that retirement is not one of the top seven reasons. Retirement is, of course, the most desired reason to sell a clinic. It is the lofty goal of most owners, the great ambition to work hard for your career, build up the value of your clinic, sell it for a high value, and take that burst of money off into the sunset of your retirement years.

That’s what most clinic owners want. And a few do actually attain it.

But reality tells a different story...

So you’ve decided to seriously look into selling your healthcare clinic. Assuming you’re doing this for a positive reason that will improve your quality of life or send you on to the next stage in your career path, the key question is, how do you increase the value of your clinic so you can command top dollar in the sale?

Determining your current value is the first step in this process, and clinic businesses should use EBITDA to find out how much their business is worth. Here’s how to value your clinic using EBITDA.

But once you have a reliable number for the current value of your clinic, what do you do if you were hoping for a higher figure? And, what can you do to increase your multiple – the number that multiplies by your EBITDA to determine your sales price?

These and many related questions were discussed in a recent episode of New Patient Secrets, as a virtual roundtable of industry experts and clinic owners spent an hour talking about everything related to selling medical clinics like dental, chiropractic, physiotherapy, and massage clinics.

Here are the top seven ways to increase the value of your health clinic.

How much is your clinic worth? If you’ve been operating your clinic for any significant length of time and can see that you have achieved some level of success, you have probably started thinking about how much it’s worth.

This question is especially common for physiotherapy, chiropractic, and massage clinics, most of which operate independently and have built themselves from the ground up.

You may not want to sell now, but you also don’t want to have to sell in a hurry. Navigating the clinic sales process takes time. Generally, you want to give yourself at least a couple years – yes, years – from the time you decide to sell to the time you actually do sell.

So, starting to think about this now, even if it’s still a long way off, it's a smart move.

Let’s go through the basic process of how to value your clinic, and how to maximize that value so you can sell for top dollar.

Learn How to Sell Your Physiotherapy or Chiropractic Practice at the Right Time, for the Highest Value

Is now the best opportunity for you to sell your physiotherapy or chiropractic clinic? Should you wait five years? Or are you on the flip side and looking to expand by buying more clinics? 

If you want to sell a physiotherapy or chiropractic practice now or in the future, you will need to know how to determine an accurate valuation for your practice. If you’re looking to buy, you’ll need the same set of skills to assess how much the one you want to acquire is really worth.

Consolidation Is Coming for Your Clinic (and Community)

With the increasing consolidation in healthcare caused by corporate takeovers, mergers, and acquisitions by private equity, if you own a clinic and haven’t been approached by a big corporation yet, just wait. It will happen. And while your first reflex may be to show them the door, the idea will be planted. 

Someday, you will want to sell your physiotherapy or chiropractic practice, and now is the time to learn how to do it such that you reap the valuation you’ve worked hard for.

This is what happened to a clinic owner in Ontario some time back, who was asking for my help with a dilemma he faced during a mentorship call.

He and his wife are in their 50s. With kids still in school, they’re not ready to retire yet, but it’s on their mind. His physiotherapy clinic has been earning about $1 million in revenue the last five years. He’s not quite ready to sell because the sale is his retirement plan. Selling now would remove his source of income too early. At least, that’s what he has been saying. 

But then he got an offer from a "big corporation" that owns hundreds of clinics, and wanted my help to decide how to respond. 

What would you do in this situation?

He has an offer now. If he doesn’t take it, what if he can’t find a buyer five years from now? And is this even a good deal? He doesn’t really know what his clinic is worth.