How Much Is My Practice Worth?

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| 8/26/2010 - 10:16 am

Dear Jerry,

I am in the process of selling my practice and am trying to determine a price that is fair to both myself and the new owner. I know that every practice is different and understand that value is in the eye of the beholder.

Most of the formulas I have seen recently call for various types of weighted three year averages of the gross income multiplied by 50% to determine the purchase price including equipment, inventory good will, etc.

I know this is a starting point, but 50% of average gross seems to be much lower than previous guidelines.

Since a lot of "baby boomer ODs" are in this situation, I would like to hear your opinion.

Thanks,

Walter Docker, OD (name changed)

Hi Walter,

“How much is my practice worth?” is always a great question and one that I get a lot.

In my opinion, the key financial metric to consider when valuing a ‘traditional dispensing OD practice’ is not Gross Revenue,

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How Much Is My Practice Worth?

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