What!?! Exit strategy? Why so soon?
If you are a healthcare practice owner in Canada, you might think that planning your exit strategy is something you can do later, when you are ready to retire or sell your practice. After all, you have just started your journey as a business owner and you have many things to focus on, such as growing your patient base, managing your staff, and providing quality care.
3 Good Reasons:
However, planning your exit strategy from the start is not only a smart move, but also a necessary one. Here are some reasons why you should start thinking about your exit strategy when you buy your first practice.
- It helps you define your goals and vision. When you buy your first practice, you have a vision of what you want to achieve and how you want to run your business. By planning your exit strategy, you can align your vision with your long-term goals and measure your progress along the way. For example, if you want to sell your practice for a certain amount in 10 years, you can set milestones and targets to reach that goal. Or if you want to pass on your practice to your children or a partner, you can plan how to train and mentor them for a smooth transition.
- It prepares you for the unexpected. Life is full of surprises and sometimes things don’t go according to plan. You might face personal or professional challenges that force you to exit your practice sooner than expected. For example, you might have health issues, family obligations, or legal disputes that affect your ability or desire to continue running your practice. By planning your exit strategy in advance, you can anticipate and mitigate these risks and ensure that you have a backup plan in place. You can also protect your personal and business assets by having the right insurance, contracts, and succession plans.
- It increases the value of your practice. Planning your exit strategy is not only good for you, but also for your practice. By having a clear and realistic exit strategy, you can increase the value of your practice and make it more attractive to potential buyers or successors. You can do this by improving your financial performance, building a loyal and diverse patient base, creating a strong brand identity, developing a skilled and motivated team, and implementing efficient systems and processes. By doing these things, you can demonstrate that your practice is profitable, sustainable, and scalable.
Planning your exit strategy when you buy your first practice might seem like a daunting task, but it doesn’t have to be. You can start by asking yourself some simple questions, such as:
What are my personal and professional goals?
- How long do I want to own and operate my practice?
- How do I want to exit my practice? Do I want to sell it, merge it, pass it on, or close it?
- Who are my potential buyers or successors? What are their needs and expectations?
- How much is my practice worth? How can I increase its value?
- What are the legal and tax implications of exiting my practice?
- What are the best practices and resources for exiting a practice?
Create a Roadmap for your Exit Strategy!
By answering these questions, you can start creating a roadmap for your exit strategy that suits your needs and preferences. You can also consult with experts such as accountants, lawyers, brokers and, consultants (such as The Art of Management Inc.!) who can help you with the planning process.
Remember, planning your exit strategy is not about giving up on your practice or being pessimistic about the future. It’s about being proactive and prepared for whatever comes your way. It’s also about ensuring that you get the best possible outcome for yourself, your patients, your staff, and your practice.
Get a Move On!
So don’t wait until it’s too late. Start planning your exit strategy today and enjoy the benefits of being a savvy healthcare practice owner in Canada.