Running your own independent pharmacy business can be very rewarding, but there may come a time when you want to sell that business and move on to other endeavors. In some ways, selling a pharmacy is similar to selling any other type of business, but there are some additional wrinkles associated with this kind of sale. Things like state regulations and insurance concerns are part of the mix when it comes to marketing and selling any pharmacy business. Here are some hints about preparing your business for sale.
Check the Insurance Regulations
Contact the insurance companies your pharmacy does business with and find out what they require when a business is sold. The new owner may need to meet the licensing requirements of the insurance company to continue to accept that insurance and fill their members' claims.
Detail the Financial Situation
Any potential buyer will want to see the hard numbers about your company. Those potential buyers will want to see how much revenue the business took in, and how much profit you were able to make on that revenue.
Gather all the financial records going back at least the past several years. The prospective buyer will no doubt want to see cash flow statements, purchase receipts and tax forms showing the status of the business and its profitability. The more information you can provide to the sales broker and the potential buyer, the better.
Find an Experienced Business Broker
Prepare a shortlist and contact several business brokers who specialize in selling small businesses. Look for a broker who has experience selling pharmacy businesses, since those sales can be more complicated than selling some other types of businesses. Alternatively, consider the option of not hiring a Broker.
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Audit Your Books
Get an independent audit of your business financials. Having the audit done helps protect your interests while reassuring the potential buyer that the financial condition of the pharmacy has been properly disclosed.
Negotiate with the Interested Parties
Negotiate with potential buyers based on the true value of the business. The sales agent you use should be able to help you assess the value of the business based on cash flow, net revenues and net profit figures.
After the sale is ready to go, you may need to once again deal with the various state agencies and insurance companies with whom you have been doing business. Contact all applicable state and federal agencies to notify them of the pending sale. You may need to complete new applications for the various agencies you deal with notifying them of the pending change in ownership.
Related:
- Tax Considerations When Preparing a Business for Sale
- Business Valuation Tool
- Check out who else is selling — Pharmacies for Sale
