Buying a practice

  • May 6, 2024
The Ultimate Guide to Buying an Optometry Practice: Steps and Strategies
Are you an ambitious optometrist looking to take the next step in your career? Buying an optometry practice can be a rewarding opportunity to fulfil your entrepreneurial aspirations, build upon an established patient base, and make a lasting impact on your community. However, navigating the process of purchasing a practice requires careful planning, due diligence, and strategic decision-making. In this comprehensive guide, we’ll walk you through the essential steps and strategies to help you successfully acquire an optometry practice.
1. Define Your Objectives: 
Before diving into the process of buying an optometry practice, take some time to clarify your objectives and goals. Are you looking to start your own practice or acquire an existing one? What type of patient demographic are you targeting? What geographic location suits your preferences and business strategy? Understanding your objectives will guide your search and evaluation process effectively.
2. Conduct Market Research: 
Establish your desired location and also think outside the square for other areas that you may not have considered that could also work well for you. Analyse factors such as population demographics, competition, and market trends. Identify opportunities and challenges specific to the area that may impact the success of your practice acquisition. Market research will help you make informed decisions and identify potential target practices. Recent census data will help you quantify your market research.
3. Establish Your Financing Plan:
Acquiring an optometry practice requires a significant financial investment. Determine your budget and explore financing options available to you. This may include traditional bank loans, working with a reputable broker that specialises in the industry, vendor financing, or partnerships with investors.
4. Identify Target Practices:
Once you have a clear understanding of your objectives and financial plan, start searching for practices that align with your criteria. You may already be working in a practice where the owner is considering selling, so have that conversation. Alternatively, organisations like ProVision and Optometry Australia have networks of practice owners in the succession planning phase so you could have the ability to connect with an owner that hasn’t put their practice on the market yet. Patience is key, so use all the resources and networks around you and wait for the right one to pop up. Consider factors such as practice size, patient base, revenue, location, reputation, and growth potential when evaluating prospects.
5. Conduct Due Diligence:
Before making an offer on a practice, conduct thorough due diligence to assess its financial, operational, and legal aspects. Review financial statements, patient records, practice management reports, lease agreements and employee contracts. Engage legal and financial advisors to help you analyse the information and identify any red flags or areas of concern.
6. Evaluate Practice Valuation:
Work with practice valuation experts or appraisers specialising in optometry to determine the fair market value of the practice. Consider factors such as revenue, profitability, patient demographics, equipment, location, competition, and market comparables. Use these insights to negotiate a fair purchase price and terms that reflect the practice’s true worth that will set you up for success.  
7. Negotiate Purchase Terms:
Once you’ve completed due diligence and determined the valuation, initiate negotiations with the seller to finalise the terms. Consider things like purchase price, payment structure, financing arrangements, transition period, non-compete agreements, and any contingencies. Seek legal guidance to ensure that the purchase agreement protects you.  
8. Close the Deal and Transition:
Upon reaching an agreement with the seller, work with your legal and financial advisors to finalise the purchase contract. Transfer ownership, obtain necessary licenses and permits, and ensure a smooth transition of patient care, staff management, and operational responsibilities. Communicate effectively with patients, staff, and stakeholders to minimise disruptions and maintain continuity of care.  
9. Celebrate and Plan for the Future:
Acquiring an optometry practice is a significant milestone in your career journey. Take a moment to celebrate your accomplishment and reflect on the journey that brought you here. Develop a long-term strategic plan for the growth and development of your practice, setting clear goals and milestones to guide your success. Stay proactive, adaptable, and committed to delivering exceptional eye care services to your patients.