Many entrepreneurs may consider a medical business for sale as an opportunity to jump right into an established and growing business rather than spend the years it takes to build one. Companies with a loyal customer base and steady revenue stream can be enticing, though the initial investment might be higher than starting small and building slowly.
We’ve identified some critical questions to consider when buying an existing medical business for sale.
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You can’t fix a bad location. Most medical businesses, whether they’re an independent urgent care or a primary care office, tend to be real-estate driven – which means the business location was selected to save money on real estate costs. However, today’s patient wants convenience.
A medical business franchise can be opened in locations that are centralized to attract and accommodate a large number of patients. In fact, this idea is at the core of the American Family Care (AFC) franchise model. We look for retail locations in high traffic areas to house our urgent care clinics.
An existing business often requires a sizable investment and can cost more than starting a franchise business from the ground up.
Don’t rely on the seller’s valuation. You should hire an independent third party to provide an expert appraisal of the business. This neutral party can remove some of the emotion from the negotiation and help quantify the business’ true value.
Once you confirm value, don’t shop by price alone. Established businesses that are highly profitable will likely cost more. A medical business that costs $850,000 with good cash flow could be a better deal than the $700,000 one where the cash flow isn’t quite as positive.
Take a good hard look at the market conditions and the current economy. For example, in 2021 the market for existing medical businesses is inflated.
However, the cost to buy a medical business franchise remains stable and does not fluctuate wildly with economic conditions. Another benefit is the investment is stated up front in the Franchise Disclosure Document so there will be no surprises.
The business model can also be one of the downsides of purchasing an existing business. If the business has been operating with inefficient processes, those must be revamped before the company can achieve its full potential. If the technology is outdated and needs to be replaced, this is another costly change needed to make the business competitive.
This is where franchise medical businesses such as AFC have an edge over independent healthcare businesses. Often, franchisors bear a large share of the costs to implement, alter, or upgrade technology that benefits the whole system.
If the existing medical business has a poor reputation in the community or many negative customer reviews online, this may pose a challenge for new owners.
You not only buy a business, you also buy the reputation. If the business has a history, it may be tough to overcome.
The brand awareness, reputation management, and strong marketing programs offered by franchised medical businesses can help conquer any negative attitudes and spread the good word about the business when it opens in a new market.
AFC is the original urgent care franchise, and our founder, Dr. Bruce Irwin, is an industry pioneer. The company has positioned itself to be a unique provider in the rapidly growing healthcare franchise industry.
AFC operates more than 240 clinics with 600 in-network physicians caring for nearly 3 million patients a year. We are the nation’s leading provider of urgent care, accessible primary care, and occupational medicine.
One of the biggest benefits of being part of our franchise is the business that comes through the partnership. You will receive the company’s name value and brand awareness, which resonates with the customers. That means less time promoting the business and attracting clients, so you can focus on running daily operations. Marketing and PR are part of the franchise agreement, giving you additional visibility and additional customers. American Family Care franchise owners receive these benefits to help them establish and grow their business.
There is a lot to consider when presented with a medical business for sale. The advantage to buying a franchise is that many decisions are already made based on past successes, and the support and resources are there for you. Your chances of doing well with your venture are increased when you join the ranks of franchisees rather than going it alone.
Apply now to learn more about urgent care franchise opportunities with American Family Care or request more information.
Ready to make a meaningful impact in your community while owning a thriving business in the rapidly growing urgent care industry? Choose AFC and discover the benefits of joining our trusted network of healthcare providers.
Contact AFC to learn more about franchise opportunities and how you can join our growing network.
