How do you value a practice?
Consultant's Corner – Q&A with the Industry Experts
Question: How do you determine what a particular practice is worth? Your firm works with medical, optometry, and dental practices. Aren't they different?
"Short answer: They are very different. Thankfully, our firm is well experienced in the nuances of all these professional health disciplines. We have valued and sold practices of all these disciplines in every major market in the nation. Our work speaks for itself. That being said, business valuation is still very tricky. Surprisingly, business appraisal is an unlicensed profession. Clients often ask me how they can assure that they are getting a suitable work product. First off, I have two certifications (CBA & CVA) which are recognized under the qualified appraiser guidelines of the IRS, SBA, and U.S. Department of Labor. Although business valuation is unlicensed, only appraisers with certain certifications are qualified to do certain qualified work. On top of that, I only appraise healthcare professional practices and healthcare businesses. This is a key distinction. Healthcare business appraisal work is vastly different than other valuation work. Our organization provides comprehensive valuation services exclusively to healthcare professionals. The proper application of industry-accepted methods and standards is critical in producing an accurate valuation for a professional healthcare practice. Our appraisers will analyze all facets of a practice including financials, clinical data, and market information. The end result is a credible appraisal report, giving our clients the necessary information and tools to achieve their outcomes."