Dr. Dimitrios Kostopoulos
If you sell your practice at the WRONG time, you’ll lose a lot of money and won’t see the fruits of all your efforts. But when is the right time?
Neil connected with his friend, business owner, and fellow physical therapist Dr. Dimitrios Kostopoulos, DPT, MD, PhD, DSc, ECS, to find out!
Neil: So, Dimi, help us think about: when is the best time to sell my practice? There’s been a lot of turmoil during the last year and a half. Therapist burnout is at an all-time high. Some people may be thinking “I’m done with this, I want out.” So when is the right time to sell?
The Worst Time to Sell
Dimi: First, let me tell you when the worst time to sell is. Of course, when there is a general downtrend in the industry, then you don’t want to sell. You’ll get less money for your practice. But the most important thing is: you don’t want to sell your practice from a position of weakness.
You want to sell your practice from a position of strength! If you are, as you said Neil, fed up with doing this and that, and you’re pissed about everything that’s going on–that viewpoint will be a predictor of what I can see in your income statement, your balance sheet, and your cash flow statement. If you are pissed with your practice and your staff, I can tell you that your financials are not looking good!
Potential buyers will dig deep into your financials. When they do, you want to show that you have created systems in your practice that have created affluence: financial affluence, affluence in terms of reputation, affluence in terms of staffing, and affluence in terms of how the community sees you. You have to sell from a position of strength.
Neil: I agree! This is a trap that a lot of practice owners fall into. They see their revenue as the end-all. But actually, money is a representation of the energy of the business. It’s an outcome based on how well the business is doing.
Dimi: Yeah, money is energy!
How to Add Value to Your Practice
Neil: Exactly, money is just perceived value. When someone comes along and wants to buy your practice, the monetary value of your practice is just a representation of the all the work and systems that are built into the practice. A well-run practice that has an amazing front desk, amazing therapy systems, great results from patients, a proven PT marketing strategy, and good billing systems will show that value in a healthy profit margin and a high revenue rate.
“I Almost Bankrupted My Practice”
Neil: If you’re struggling in these areas, just realize that the reason you’re struggling is that you have not trained yourself well enough to run a practice. I had this happen to me many years ago in my practice–we were almost bankrupt! And the reason we were bankrupt was because I didn’t know how to effectively manage people.
Luckily, a business consultant kicked our rear end. I realized that I had to get better at business.
Dr. Dimitrios Kostopoulos is the founder of Hands-On Diagnostics Companies, and helps PTs triple the value of their practices by adding diagnostic tools like EMG Testing, MSK Ultrasound Testing, and more!
Want to hear the full conversation between Dimi and Neil? Visit our YouTube channel or download the latest episode of the PT Marketing Power Hour podcast–available wherever podcast are found. To get in touch with Dimi, visit www.HandsOnDiagnostics.com.
