“How will Coronavirus affect buying a chiropractic practice?” is one of the big questions we are receiving from interested buyers who are considering purchasing a chiropractic practice. Naturally, chiropractors want to know how the current coronavirus crisis is going to impact a potential chiropractic purchase and sale.
Fair warning – even though you are probably sick of getting emails or reading articles about what to do to keep safe, statistical analysis and predictions about the COVID-19 crisis – there will be none of that here.
What I am going to speak about is how coronavirus and buying a chiropractic practice may impact each other.
And for the record, it’s not all bad news! In fact, there are several AWESOME opportunities happening right now that I want to let you know about if you are in the market for buying a chiropractic practice.
1. Lower Interest Rates: In case you haven’t heard, the Feds have dropped interest rates in response to the coronavirus crisis which means that practice purchase loans are going for as low in the 4% range, which is the cheapest that we have EVER seen bank loans for business purchases. This means that your purchase power has just INCREASED and the overall cost of purchase loan you will get has DECREASED. Double win there.
2. Lower Downpayment Requirements: Thanks to recent SBA changes, you can also qualify for a bank loan with as little as 5% downpayment on the purchase price. Typically the SBA wants to see 10% and many lenders want more than that, but the banks we work with understand chiropractic and healthcare purchases and have programs in place for as little as 5% downpayment. Another win and a better opportunity for Buyers to be able to get loans.
3. Established Track Record: when banks value a chiropractic practice, they mainly look in the rearview mirror. So, yes, even if Coronavirus is affecting your practice you are considering purchasing now, the past stats weigh more heavily. And by the time you go through the stages of speaking to the owner, getting the financing to buy and signing agreements, the impact of Coronavirus could be over and done. Contrast this with attempting to get a loan to START a practice amidst the Coronavirus crisis. With no track record, no established patients, nothing for the banks to go on — startup loans may get much more difficult to obtain.
4. Take Control of Your Future: Purchasing an existing chiropractic business – even in uncertain times — is a great opportunity to control your future. Some DC’s may think that it’s too risky to buy a practice right now, especially with economic uncertainty at hand. Instead, they feel “safe” with their current associate position. Unfortunately, I’m going to rain on your parade and state the obvious.
True security will never happen in the hands of another boss that has control over your paycheck, the hours you work, what you must do to perform your job well, or to sustain the business in tough times.
Furthermore, if the business you are currently working for starts to shake, your job is definitely not safe. If economic hard times hit the practice you are working in as an associate, the owner is not going to put him or herself out of work – they will let you go. Your future is more certain if YOU own the business because you can determine your future!
5. Bargains May Appear, Solid Practices Stand Out — Similarly, there will be practices that are struggling or aging owners who are fed up and ready to get out. If you’re ready to buy, this may be an excellent opportunity to buy a chiropractic practice (amidst the coronavirus challenges) at a bargain. Here, you will find the same principles that apply in the stock market (buy low, sell high) may work in your favor for a chiropractic practice. Finally, there are some chiropractic practices that will feel little to no financial impact because of coronavirus. If you are looking for a rock-solid business that can weather tough times, these will become easily apparent.
NEXT STEPS
So if you are on the fence about continuing your search or buying a chiropractic practice because of coronavirus concerns, my suggestion is to act SOONER.
I know there is a lot of uncertainty out there, but I just wanted to encourage you, as a prospective Buyer, that this may be an ideal time for you to take control of your chiropractic future and make the most of the current market conditions.
I hope you are well, that you are staying safe, and wish you the best for the future.
Best,
Tom
P.S — Check out our listings of Chiropractic Practices for Sale & Associate Opportunities. You can see our current listings of chiropractic offices for sale, associate opportunities, and some that are coming soon as well.
P.S.S. –> Join me for my **NEW** FREE WEBINAR –> Chiropractic Practice Financing 101: How to Buy a Practice to learn what chiropractors need to know about purchasing a practice and getting a loan to buy it.
