Fri, 29 Nov 2024 06:40:29 -0800WeeblyMon, 08 Apr 2024 07:00:00 GMThttp://omnipg-opto.com/blog/preparing-for-the-emotional-roller-coaster-in-your-practice-transitionAs you get nearer and nearer to retirement and are preparing to sell your optometry practice, there is something you need to ponder that many doctors do not think about.  That is the emotions you will go through during and after you sell your practice.
Selling space or even charts is easy.  It’s just an object that you are giving to another doctor to own.  But, I’ve had many doctors who realize their life will be different going forward after their transition.  They may have staff they have worked with for 25 years or more.  They have seen patients grow from being a child to being a parent and some even become grandparents.  Now their children and grandchildren are patients of the office.  You have vendors and your CPA that you have gotten to know personally and confide in.  Staff, patients and the vendors have all become family and you will not be seeing them as often as you have in the past. 
You will also be changing your life in that you no longer are the owner, manager and decision maker with people relying on you to lead them.  You may no longer have to wake up and go to work every day.  Believe it or not, you may even have “spare” time and have to find new hobbies, rekindle old ones or maybe even find take care of the honey-do list.
The good, if not great news, is that the staff, patients and vendors are thankful for the years of service you have provided them in addition to your friendship.  They want you to enjoy life and spend time with your real family – spouse, your parents, kids, and grandkids.  Preparing for this emotional aspect of your practice sale will help make your optometry practice transition into retired life a much smoother process.  ]]>Tue, 09 Jan 2024 08:00:00 GMThttp://omnipg-opto.com/blog/reasons-to-list-your-optometry-practices-for-sale-with-omni-optometry-practice-groupWhether you are planning for retirement, looking to relocate, or taking your Optometry career in a new direction, placing your Optometry practice up for sale is a huge endeavor, one that you should not be do alone. The experts at OMNI Optometry Practice Group are dedicated to providing their clients with the best possible services to meet their needs, while building a trusting relationship. Here is why you should trust OMNI Optometry Practice Group when listing Optometry practices for sale.  
Confidentiality is Paramount
At OMNI Optometry Practice Group, maintaining seller confidentiality is one of their highest priorities. Deciding to list a Optometry practice for sale a major career move, regardless of the reasons behind it. When confidentiality is breached, the practice risks losing valuable patients and employees who would otherwise have remained during and after the sale, which reduces the overall value of the practice. For this reason, the professional team at OMNI Optometry Practice Group have dedicated themselves to becoming experts at maintaining complete confidentiality throughout the process, while ensuring high listing exposure.
Marketing Experts
Even the most profitable Optometry practices for sale can sit on the listing pages indefinitely when marketing efforts are lacking. At OMNI Optometry Practice Group, this is not an option. The OMNI team of professionals have extensive experience and formal training as marketing experts to ensure the highest exposure for the listing as possible without risking the seller's confidentiality. Each practice is listed across the nation in over 30 locations, including:

• Universities
• Associations
• Programs
• Social Media Platforms
• Online Marketing Efforts
• Mailers
• And More

To better expose Optometry practices for sale, OMNI Optometry Practice Group has built strong lasting relationships within the field. These relationships, which also help in speeding up Optometry practice transitions, include:

• Vendors
• Bankers
• Attorneys

When you are ready for a career move involving the selling of your current practice, you can trust the experts at OMNI Optometry Practice Group to maintain your confidentiality, while marketing your practice to a large group of potential buyers. To better assist you in the transition, OMNI Optometry Practice Group is a leading provider of a wide range of services to Optometry professionals, which include:

• Practice Sales or Transitions
• Valuations
• Consulting
• Real Estate Service
• Buyer Representation

To learn more about listing your Optometry practice in the Washington, Oregon, or California areas, please contact the expert team at Omni Optometry Practice Group. OMNI specializes in Optometry practice sales, and are dedicated to ensuring your success throughout the entire process.]]>Tue, 14 Nov 2023 08:00:00 GMThttp://omnipg-opto.com/blog/optometry-practice-transitions-and-taxesTaxes are a fact of life, and an extremely important consideration when considering an optometry practice transition or sale. Let’s explore some potential tax mitigation strategies to consider.

Stock Sale. If you are incorporated, sale of the stock in your corporation to the optometry practice buyer can potentially yield you the greatest tax savings, because the sale of stock is almost exclusively taxed at the lower fixed capital gains rate as compared to the higher, tiered ordinary income rates. However, and this is a BIG however, stock is a non-depreciable asset to the buyer. As such, the optometry practice buyer is not able to write off the sales price and essentially ends up buying your practice with after-tax dollars. Consequently, a buyer is likely only to agree to buy your stock if you are willing to reduce your purchase price by 30 percent or more. For this reason (and many associated legal and liability complications), almost all optometry practices are sold as “asset sales.” In other words, the seller retains his/her corporation and all of its stock and instead sells all of the tangible and intangible assets of the corporation (i.e., the optometry practice). The buyer is then able to depreciate and amortize (write off) the entire purchase price.

Price Allocation. The IRS requires the total price of an optometry practice for sale to be allocated to the various types of assets being sold and that the allocation be made according to the fair market value of the assets. As a general rule, the tangible assets are taxed as ordinary income above basis, and the intangible assets are taxed as capital gains. (Above basis means the difference between what you are selling the tangible assets for and your book value or depreciated value.) Any consideration for a covenant not to compete will also be taxed as ordinary income. Since fair market value is somewhat subjective, there is some room for negotiating the overall allocation of the purchase price. As a optometry practice seller, you will save taxes if you can negotiate with a buyer for a lower allocation to tangible assets (equipment, furniture, fixtures, supplies, etc.) and a higher allocation to intangible assets (goodwill and patient records). (Unfortunately, it will benefit the optometry practice buyer to have just the opposite allocation, so consideration must be given to making the allocation fair to both parties.)

Carry back a note. Sellers frequently ask us, “Won’t I save on taxes if I self-finance part or all of the sales price (i.e., carry back a promissory note from the buyer)?” The answer is, “No, but maybe . . .” As mentioned above, the portion of the price in an asset sale that will be taxed as ordinary income will be due in the year of the sale. That recapture will be taxed regardless of the receipt of any actual cash at closing, which means you owe the ordinary income tax associated with the recapture even if you do not receive a cent at closing. Consequently, if you do not want to have to pay to sell your practice, it would be prudent to ask for enough of a cash down payment to cover the tax liability you will incur from the recapture. Since most of the remainder of the sales price will be taxed as capital gains and since the capital gain tax rate is a fixed rate, the same tax will be applied and the same tax amount owed whether you receive that portion of the price now or paid to you over time; unless . . . there is a change in the capital gains tax rate before the note you are carrying is paid off. If the rates go up, you would be taxed at that higher rate on that income as it comes in. Otherwise, self-financing a portion of the price serves only to defer capital gains tax, but it will not lower the total tax. (Also note that the interest portion of any promissory note payments will be taxed as ordinary income to the holder, while the principal portion subject to capital gains will be taxed at the capital gains rate.)

Sale Timing. As discussed above, the tax associated with recapture over basis on the sale of tangible assets will be determined by your ordinary income tax bracket in the year of the sale. If you are planning to retire after the sale of your practice and, consequently, will have a drop in your ordinary income level, it may behoove you to strategically time the sale of your practice until after the start of the next tax year. Also, if you have owned your optometry practice for less than one year, you should, if possible, wait at least one full year before selling it since the sale of goodwill within a year of ownership will result in the higher short-term capital gains rate being applied instead of the long-term capital gains rate.

“C” Corporation Consideration. If you are currently incorporated and being taxed as a regular “C” Corporation, the sale of goodwill by your corporation will likely be subject to double taxation, once as capital gains inside your corporation and then again as ordinary income when paid as a distribution to the shareholder(s). There is some case precedence that allows for the shareholder(s) of “C” Corporations in closely held and professional businesses to sell goodwill individually, outside of the corporation, thus avoiding that double taxation. If this applies to you, consult with your CPA and/or tax attorney regarding the details of such a tax strategy and its application to your particular situation.

1031 Exchanges. If you are selling an optometry practice now and are planning to buy another practice within six months, a 1031 or “Like Kind” Exchange may be a tax deferral strategy to consider. It allows you to defer the taxes associated with recapture over basis you would otherwise incur with the sale of your tangible assets. A 1031 Exchange has very specific and rigid requirements. Consult with your CPA and/or tax attorney regarding the details of such a tax strategy.

Charitable Remainder Trusts. Charitable Remainder Trusts are not subject to capital gains tax. As such, a seller may potentially eliminate capital gains tax on the sale of his goodwill by donating it to a qualified charity. The downside, obviously, is that the seller must donate the goodwill proceeds to that charity. This is another strategy where you would want to receive guidance from your CPA and/or tax attorney.]]>Mon, 16 Oct 2023 07:00:00 GMThttp://omnipg-opto.com/blog/selling-your-practice-does-not-mean-you-have-to-stop-practicingWhether you have owned your practice for 40 years, or owned it for 5 years, selling your optometry practice does not mean you are done practicing.  We often meet with doctors who are sick and tired of managing their staff, doing the bookkeeping, playing the games with the government agencies, dealing with the ups and downs of the economy, changing environment of the profession and on and on.  The doctors are about to crack, but think they cannot yet sell their practice as, according to their CPA or financial advisor, are not yet financially ready to retire.  We counter this by asking them "who said you need to retire?"  You can "harvest your equity" and either work back in the practice, or go work for another practice.  What the CPA's and financial advisors may not see is that your practice collections numbers are going down.  Or, your blood pressure is sky rocketing due to the above mentioned challenges of managing your practice to the point of a heart attack coming right around the corner.  If you have a good amount of equity in your practice, we can sell your optometry practice and you can put the cash in the bank and work as an employee until you are ready to retire in 5, 10, 20 years, or as long as your heart desires.  Transitioning out of your optometry practice may be the way to enjoy your profession again.

]]>Thu, 07 Sep 2023 07:00:00 GMThttp://omnipg-opto.com/blog/how-omni-optometry-practice-group-can-help-speed-up-the-process-of-selling-a-optometry-practiceSelling a Optometry practice, also known as Optometry practice transition, is a time consuming and often stressful experience, both for the seller and for the buyer. Even with a professional to help with the process, it can sometimes take years to complete. OMNI Optometry Practice Group can help to streamline the selling process, making the transition smoother and much quicker for all involved.
Hard Work and Dedication
On average, it takes approximately 200 man hours to complete a transition from start to finish. The experienced team at OMNI Optometry Practice Group work hard to complete the process as quickly as possible by focusing on each client's needs, while maintaining complete confidentiality until the sale is completed.  One way OMNI Optometry Practice Group does this is by showing the Optometry practice after hours, over the weekends, and will even conduct showings throughout the holidays as needed. When it comes to selling a Optometry practice, OMNI Optometry Practice Group is dedicated to the success of their client, before, during, and after the sale.
Keeping the Buyer Focused
Due diligence is a key part in Optometry practice transitions. The experts at OMNI Optometry Practice Group strive to keep buyers focused throughout each step of the process. Obtaining financing, for example, can be a complicated and drawn out step in selling a Optometry practice. Through assisting buyers with the financing portion of Optometry practice transitions, OMNI Optometry Practice Group helps maintain the momentum of the sale up to closing, regardless of the type of transition needed to ensure the best possible outcome from both the seller and the buyer.
Experience
Hundreds of doctors have successfully bought and sold their practices through the OMNI Optometry Practice Group. The experience allows the professionals at OMNI Optometry Practice Group to handle a wide variety of Optometry practice transitions throughout each step of selling a Optometry practice, with creative transitions and solutions being a specialty. Some of the types of Optometry practice transitions include:

• Setting up associate to own agreements
• Partnership sales
• Merging practices
• Outright sale of the practice

OMNI Optometry Practice Group has the experience and resources to successfully perform all aspects of the transition process, such as:

• Consulting
• Valuations
• Real Estate Services
• Transitions and Sales

To learn more about how Omni Optometry Practice Group helps doctors sell their Optometry practice in the Washington, Oregon, and California area, please contact their team of experienced professionals for a free consultation.]]>Mon, 10 Jul 2023 07:00:00 GMThttp://omnipg-opto.com/blog/5-reasons-to-hire-an-optometry-practice-specialist-during-the-optometry-business-sale-processOptometry practice business owners have a significant opportunity to make a return on investment when they enter the marketplace and sell their business. But to maximize the value of their return, they must work with proven industry experts. In this article, the trusted team at Omni Optometry Practice Group explains five reasons to hire a optometry practice business expert during a optometry practice sale.

1. Database of Buyers
Those within the marketplace will have access to a comprehensive database of practice buyers. They will have completed all due diligence on those capable of completing the transaction and have developed comprehensive business relationships within the industry. This can help streamline the business transaction and ensure sellers receive a lucrative price for their business.

2. Full Access to Marketing Channels
Specialists within the optometry practice marketplace can help enhance sale strategies through effective marketing channels. They know the areas potential buyers look for buying opportunities and can craft refined marketing strategies designed to appeal to specific types of buyers. Their access to these highly effective marketing channels also means industry specialists can help maximize the value of the business and reduce sales roadblocks.

3. Help Selecting a Transition Plan
Working with a trusted optometry practice sale expert also means that business owners can select their ideal transition plan when selling their company. For example, they may wish to only sell part of their practice and remain the owner of the rest of the company. Specialists within the industry can help coordinate this process and ensure that the full value of the entire organization is protected during the sale. Optometry practice sales experts can also help coordinate sales to corporate groups by individual owners, advising the owner on their rights within the process and helping to complete the complex documentation involved within the sale.

4. Direct Access to Sales Knowledge
One of the leading reasons so many optometry business owners are now choosing a specialist for the sale of their practice is that specialists can answer questions based on direct knowledge within the industry. They can help the practice owner decide what to do with their equipment after the sale. for example. They can also answer questions related to post-sale staff needs, as well as how to communicate with staff directly during the sale process. This eases the sales transition and ensures business owners also have an expert available to consult with throughout. 

5. Creating a Valuation for the Company
By determining the value of the company, optometry practice experts can ensure their client achieves full value for money. They can use their industry knowledge, as well as their understanding of the local marketplace, to ensure the company is valued at a level that will attract high quality buyers and ensure a fast, and profitable sale. 

By working directly with a trusted optometry practice sale expert, optometry business owners can maximize the return for their business investment. To learn more, speak with the team at Omni Optometry Practice Group directly at 877.866.6053 or email info@omni-pg.com]]>Tue, 04 Jul 2023 07:00:00 GMThttp://omnipg-opto.com/blog/how-omni-optometry-practice-group-helps-practice-owners-prepare-their-optometry-practice-for-saleBy working with trusted industry specialists, optometry practice owners can ensure a swift profitable sale for their business. The team at Omni Optometry Practice Group has many years’ experience within the optometry practice marketplace. They have helped hundreds of owners understand the sales process and worked with a range of clients to ensure their practices are sold with seamless precision for lucrative returns. In this article, their experts explain the business sale process and how Omni Optometry Practice Group prepares business owners for the sale of their optometry practice.

1. Financial Reporting
A critical element in the sale of any business property is financial reporting. Buyers will complete due diligence on the company they are purchasing and it is important all financials are in order and ready for review. Omni Optometry Practice Group helps business owners complete the financial reporting process. They gather the required documents and ensure the documents are completed accurately and according to the strict standards within the industry.

2. Consolidating Business Resources
During the search for a local optometry practice for sale, buyers will be reviewing the market for practices that are lean and do not have excess resources to manage and pay for over the long-term. After assessing the finances of the practice, Omni Optometry Practice Group works to consolidate the business’s resources, removing unnecessary expenses related to vendors, staff, and equipment and helping business owners understand the resources that are important to their company and potential future buyers.

3. Remodeling Work
In consulting with optometry practice owners, Omni Optometry Practice Group will advise them on potential remodeling requirements. They will guide owners on the paintwork and property upgrades required to ensure the practice is sale-ready. This process is completed alongside trusted building inspection teams that analyze all areas of the property to determine whether any upgrades are required before placing the practice on the marketplace. Any issues in the practice will be highlighted by the buyers’ representatives during their due diligence on the practice, and so sellers that finish remodeling work proactively and ensure all problems are resolved can showcase their commitment to the sale.

4. Analysis of Practice Value
When getting their optometry practice ready for sale on the marketplace, owners must consider the optimum value for the company and how they can harness this valuation to attract the right types of buyer for the organization. Omni Optometry Practice Group has significant experience in this area of the marketplace. They can help business owners detail the most important elements that determine a practice’s value. For example, they know that margins are more important to buyers than gross production levels. And so they can use this knowledge to value the practice at the highest rate possible according to market demand.

Omni Optometry Practice Group is a clear leader within the local industry. To learn more on the company and their services, contact their offices directly today at 877.866.6053 or email info@omni-pg.com. ]]>Fri, 30 Jun 2023 07:00:00 GMThttp://omnipg-opto.com/blog/are-you-5-to-7-years-away-from-selling-your-optometry-practice​You have had a great career and now you are thinking about selling and transitioning out of your Optometry practice. You would like to get the best value for your practice. Do you just walk away?  Being prepared can not only help you get the best price, it will help ensure a smooth transition. 
 
Here are a few things you can do to help prepare for your Optometry practice transition:

1. Know your financial situation - Meet with your financial advisor, CPA, or whoever gives you financial advice to get a good picture of where you are with your savings and investments.

2. Get a practice valuation - A practice valuation will help you see how much equity you have in your practice.  Additionally, a CPA can help you figure out what the taxes and net proceeds from your sale will be.

3. Update Technology - Buyer’s like to see new technology in a practice.

4. Cosmetic updates - Have you updated the interior with paint and carpet in the last 20 years?  If not, it’s time.  Buyers like a practice with a fresh feel to it.  A 1970’s feel was good in the 1970’s.

5. Review Accounts Receivable Aging - Collect any past due accounts, send to collections or write them off.  Also, review credits to either pay back to the patient or send unclaimed property to the State.

6. Review Staffing - Are you over or understaffed?  Adjust accordingly.

7. Clean up your financial statements - Make sure the expenses you’re running through your Optometry practice financial are related to your practice, or at least identifiable as an adjustment. 

8. Consider ramping up production - If you are not sure how, then hire a Optometry consultant.  Ramping up your practice when you’re 3 or more years out will pay dividends on the sales price.

9. Review your fees - Do you have the lowest fees in the area?  Consider a fee increase to catch up.

10. Harvest your Equity - Maybe you are a few years away from retirement, but tired of being an owner.  You should consider selling now, take the equity out of your Optometry practice and work back as a Optometry associate.
 

]]>Wed, 14 Jun 2023 07:00:00 GMThttp://omnipg-opto.com/blog/preparing-to-buy-a-optomerty-practice​You've heard it before, the separation is in the preparation.  This is a quote that is typically heard in athletics, but can be applied to other endeavors as well, including buying or starting a new practice.  But, what do you prepare for before you jump into Optometry practice ownership.  Just ask any practice owner, there are a lot of things you can prepare for before you buy an Optometry practice.  Here are a few things that will help you separate yourself from the rest of the pack and allow you to hit the ground running when you become a practice owner:
 
1. Where You Practice Matters - Know where you want to practice and the demographics of the area you are looking to practice. There are a lot of different websites and services you can look to in order to get this information. A lot of commercial brokers (Steve at Omni Healthcare Real Estate) will have data ranging from a breakdown of the age of the population, to ethnicity, income levels, how much money was spent on dog food per person, etc., There are several services such as Scott McDonald's that will help you gather data as well.
 
2.  Knowing Your Market - Understand what the numbers and ratios of a typical Optometry practice should look like.  Your state or national association has resources that will show how much you should be spending on staff salaries and benefits as a percentage of total collections, as well as rent, marketing and other financial data as a percentage of collections.  
 
3.  Basic Accounting - Start educating yourself on basic accounting principles.  Specifically, learn how to read a financial statement - profit and loss report and balance sheet.  You will be given these by the Optometry broker when looking at a practice, so you should at least know what they are and what a financially viable practice looks like vs. a not so nice practice.
 
4.  Bank Financing - Contact a bank that specializes in Optometry practice financing before you start looking.  They cannot necessarily pre-approve you for a certain practice, but they can tell you whether you can get a loan, approximately what rate and terms you can get and possibly how much you may be able to qualify for.  You don't want to go after a $2 million practice if you cannot get a $2 million loan.
 
5.  Looking For Red Flags - Knowing where to find the skeletons in the practice is a key element in the process. Where do you look for embezzlement in the practice?   How about hidden staff incentives and payments?  Over or under treating patients?  Uncollected accounts receivable?  Etc.,
 
6.  Learn About Leases - What is a triple net lease?  What is the market rate for leases?  How much time is left on the lease?   What's a tear down clause?,etc.,
 
7.  Surround Yourself With a Good Team - Surround yourself with a good team; CPA, Broker, Attorney, Consultant, etc., Find those that specialize in your specific discipline.  They can help you avoid some of the pitfalls you may miss.
 
By preparing yourself ahead of time with some of these things, you can avoid having to spend more than you need to and find a practice that will bring you great professional challenges and rewards in the long run.]]>Tue, 06 Jun 2023 07:00:00 GMThttp://omnipg-opto.com/blog/are-you-ready-to-sell​This is always a difficult question to answer for most optometrists. You may still love practicing but want less stress. How is your body holding up? Do you have enough money to retire? How much is your practice worth?
Contact your transition consultant/broker and have a heart to heart about your practice, goals, and options. We have a lot of experience to share that may be beneficial to you. We can do a complimentary quick look to give you an idea of what your practice may be worth and of course a full valuation will need to be done to determine the final value.
Once you have an idea of what you may be paid for your practice and any associated real estate, you can talk with your CPA and financial planner to know what retirement looks like for you, as well as planning what to do with your sales proceeds. You may have practice or real estate debt to pay off at closing, or you may have a retirement plan you can utilize to save on taxes.
Many optometrists don’t know if they want to sell their real estate with the practice. In our experience, the best person to own the space is the optometrist working in it. If you happen to have a lot of rentals and enjoy that, maybe this is an option for you, but if your buyer leaves, empty optometry spaces can be difficult to sell.
Sometimes optometrists believe their practice is worth more than our valuation and want to stay on to increase collections that may have waned a bit due to slowing down. You can certainly do that but know that banks look at the last three years of tax returns so if you want to increase collections to increase practice value, you will need to increase and work another three years.
If you still love practicing and want to sell and stay on part-time, you need to start thinking about how much you want to work and how you will build a practice that can maintain a schedule for more than one optometrist. This can be done, but you need to have a plan and your transition consultant can assist with this.
Are you ready to sell? Give it some serious thought after talking with your advisors and make the decision with confidence.
]]>Tue, 06 Jun 2023 07:00:00 GMThttp://omnipg-opto.com/blog/entrepreneurial-energyWhat defines entrepreneurial energy? According to David Lyons PhD,

“Entrepreneurial energy is the force that sustains the momentum and velocity of progression in the venture. Energy can rise through excitation/agitation and fall through decay of the energy as a result of predicaments or failures.
Entrepreneurial energy is an endogenous force that fuels motivation and sustains entrepreneurial action and momentum. Encapsulating hope, optimism and obsessiveness, the nature and experience of the entrepreneurial energy provides meaning to the entrepreneurial pursuit and venture. Entrepreneurial energy is a motivational construct characterized by positive intense feeling, emotional arousal and internal drive and engagement in the pursuit that is salient to the self-identify of the entrepreneur. The positive affective state also generates positivity in the cognitive state fostering creativity and recognition of new patterns of information critical to opportunity recognition and exploitation in the external environment.
Entrepreneurship, after all, is a science of turbulence and change, not continuity. Turbulence is caused by certain force. Such is the force in entrepreneurship, like the wind is felt but not seen; or seen through the ruffle of the leaves but not the wind itself.”

Most of you reading this article can relate to those attributes, especially early in your career.  Remember talking to your friends in optometry or medical school and making plans for your practice? Remember the excitement of updating your new practice? Remember the hours put in behind the scenes to get the practice where you wanted it?

Do you still have that energy in you? If you do, this is a great time to be an optometrist or ophthalmologist entrepreneur. Consolidation is happening and it will favor the big and the bold.

What if you don’t? That is okay also, but the time to consider harvesting your practice asset is now.

In my exit-planning training, coaching our clients to either grow or sell their businesses was absolutely paramount. Stasis really is an illusion. Equipment gets older. Technology becomes dated. Marketing plans become obsolete. Business values decline.
​
So ask yourself, grow or sell?]]>Mon, 05 Jun 2023 07:00:00 GMThttp://omnipg-opto.com/blog/pitfalls-to-avoid-in-buying-a-buildingBy Steve Kikikis, Vice President, Commercial Real Estate Broker

Money Pit or Cash Cow?

On occasion when a doctor purchases a practice there is also an option to purchase the real estate.  Historically, real estate has been a good investment over time, but owning a commercial building has its own nuances. 

There are a lot of similarities between owning a commercial building and a residential house.  As the building owner or homeowner, you are responsible for paying the insurance, maintenance, and property taxes.  Be sure to understand what your out-of-pocket costs are before you take on the responsibility of purchasing a property.  Investing in a building or home inspection conducted by a reputable building inspector is always worth it.

Before you purchase a commercial building, know your demographics, and do your research.  If a building is a steal, make sure you do some research to find out why.  A commercial real estate broker that specializes in your industry can assist you in looking at the demographic information to fully understand the value of the real estate.

After you’ve purchased the practice, you are now the king of your castle and if you are business savvy, you can make a profit from owning your building.  Having some knowledge of what to expect and what the pitfalls are of owning a building can save a lot of headaches down the road.  For this article, we will consider that you are the owner and sole tenant of your building. 

Maintenance – You’re now responsible for everything from the leaky roof, sweeping the parking lot, HVAC systems, lighting, ADA compliance, security systems, plumbing, and possibly the water and sewer mains underneath the property.   The best advice is to adhere to a schedule with regular and preventive maintenance.  Don’t skimp on issues that may seem small but that can turn into a bigger safety issue (both expensive and potential lawsuit if hazardous) in the long run.

A lot of potential challenges are dependent on the age of the building and how the previous owner took care of the property.  You can hire a property manager to be the point of contact so you’re not distracted and can concentrate on your work.  Some owners like to be involved in every decision, while others don’t want the hassle of being contacted for leaky pipes, clogged toilets, etc.   

Insurance – a commercial building policy will differ from a residential homeowner’s policy on your home.  A commercial policy will also have coverage for the business operations, its products, and operations liability.  Much like homeowner’s insurance, the age and construction type of the commercial property will determine the premiums.  Commercial insurance is also based on the neighborhood where the building is located.

Although chances are slim, some policies cover loss of income in the event of a fire or other loss of the building.  These are usually additional policies that can provide peace of mind. 

City ordinances – Although you may own the building, ownership doesn’t necessarily mean you can do anything you want.   An example is a new building owner who wanted to utilize a specific size of a sign for his business, but the city ordinances stated a sign can be no bigger than 30 square feet.  Be sure to reach out to the city before you decide to change or update the signage on your building and also verify if there are any restrictions for the exterior of your building such as signage, color, material, etc.

Taxes – There are two points on the taxes. First, for the building taxes, make sure your ownership is properly transferred to you during the purchase, and make sure that you keep up-to-date on your taxes. Set up an account directly within the municipality you are located or make sure your loan program is paying it directly. For your business taxes, owning your own commercial real estate has many tax advantages. Connect with your CPA, make sure you’re paying your real estate entity as a business expense, and more.
Money Pit or Cash Cow? There will be costs to owning your own commercial real estate, but taking the proper steps and working with an experienced commercial real estate broker that specializes in medical/dental purchases will save you time and a lot of money. Just think, if you are leasing a space, after 10 years you will be signing up for paying the landlord another 5 years of income. If you own, after 10 years, you will be working towards paying that building off and have the equity in the building.
]]>Mon, 05 Jun 2023 07:00:00 GMThttp://omnipg-opto.com/blog/what-to-do-with-your-practice-if-you-are-sick-or-dyingMost of us have a vague notion of what retirement might look like but that’s where our planning usually stops.  Getting sick or receiving a terminal diagnosis isn’t something that is easy to think about and is even more difficult to talk about.  Nobody wants to contemplate their last moments in this world. 
Sadly, we have all witnessed peers who have been thrown a curve ball and had an illness or untimely death.  The aftermath of these events places a huge strain on our families.  However, these stresses can be lessened with some discussion and at the very least, taking the steps now to get the right people in place when you need them.
An unexpected sickness can occur at the height of our professional careers.  Depending on the prognosis, it’s critical to get our affairs in order as quickly as possible.  Staff might suspect that something is amiss, and you can ask them to keep health issues confidential.
If you haven’t assembled a team already, start searching for a reputable estate-planning attorney and CPA.  Also include the often-overlooked professional; a practice transition broker who can assist with the transition of your practice and can begin the process with you as soon as possible.  Most widows/widowers are not thinking that the responsibility of selling the practice will fall on their shoulders.  We recommend starting these delicate conversations with your spouse now, so they are not left to deal with this in addition to emotional stress.
If you are still able to work at your practice, we can begin to market the practice heavily but discretely so we can find a buyer as quickly as possible.  The best medicine for you is to heal and take care of your family.  Selling might seem short-sighted if you expect to make a full recovery, but there are many other options available if you still want to continue to work after you heal.
However, for those doctors who pass unexpectantly, word of mouth tends to get ahead of any marketing and the reality is that your practice will be marketed without a doctor and thus the practice value can decrease substantially.  Some of the most difficult challenges that we have encountered are in serving spouses who are left to deal with quickly selling a practice when the doctor is sick or has passed away.  The value of the practice drops sharply and is often valued at 30-40% less even after just one month without a doctor.  
Prepare for the unexpected.  Assemble your professional team and get your estate planning documents in order.  Most importantly, make this information accessible and communicate your wishes with your spouse. 
Life is short, spend your days doing what you enjoy and take care of your health. ​]]>Sun, 04 Jun 2023 07:00:00 GMThttp://omnipg-opto.com/blog/where-to-own-a-practiceThe question we often get from potential practice buyers is “Where is a good spot to own a practice?”  There are a lot of factors that contribute to answering that question. But first, let’s discuss the reasons why you want to own a practice.

If you are in it because you love practicing optometry and love helping patients and you are not necessarily in it to make the big bucks, you can really own a practice almost anywhere.  A lot of buyers seem to want the downtown metropolitan practice thinking it’s a great place to practice since there are so many potential clients and you can live the urban lifestyle.  I’ve helped doctors who absolutely wanted to be in a metropolitan area, even though the demographics made no sense whatsoever, who then started a practice and did quite well.  One doctor that I helped always dreamed of owning a practice in a particular city.  He went for it and is successful.  And I have seen others want a practice in a certain area, and although the numbers didn’t make sense, they did it anyway and were successful.

Some of you are buying a practice because you want to make a lot of money, in which case, further analysis and discussion is needed.  If you’re buying an existing practice and you have identified that the practice already has good cash flow, you can purchase the practice and have success almost no matter where it is. If it’s a poor performing practice, you would need to examine if the poor performance is because of the location, the management, or something else.  If you want to buy an existing practice and are looking for an opportunity to grow and have lower overhead, I would suggest looking outside of the metropolitan areas.  Practices outside of metropolitan areas have less competition, wages and rents are lower, and it’s easier to grow those practices.  And if you are considering doing a startup practice, the same rules apply.  Look for a location with good demographics outside of metropolitan areas.  Of course, if you absolutely want to be in a metropolitan area, don’t be afraid to go for it.  Just look closely at the numbers and hire a good optometry practice or real estate broker to help you out. 

I do recommend that you do a bit of demographic analysis on the locale.  See how many optometrists are currently practicing in the area.  A good ratio is 2,000 daytime population for each doctor.  There is a difference between the daytime population and the regular population.  The daytime population includes the workforce.  For example, if you look at the population of South Lake Union during the day vs. the nighttime population, you would see a big difference.  Another demographic to pay attention to is the age of the population.  For a general practice, a good mix of young and old is best.    Homeownership is another good indicator of practice success.  You want to have more homeowners than apartment renters. You can obtain detailed demographics either through a company that will charge a fee and provides data such as the average annual dollar amount spent on optometry services per person within a zip code and other more granular items.  Or, Omni has information that we can provide.

One of the advantages of working with Omni is that we have both optometry practice brokers and real estate brokers to help you traverse the ownership trail in any way we can.  Just give us a call at 877-866-6053 or email us at info@omni-pg.com and we’ll be happy to help get you started.
]]>Fri, 02 Jun 2023 07:00:00 GMThttp://omnipg-opto.com/blog/partnershipsPartnerships can be great or not-so-great. They can include different scenarios: buying a partnership, adding a partner to your existing practice, or a start-up partnership. To ensure you have the best outcome, financially and emotionally, you’ll need to consider some important questions.
 

• Are you friends, relatives, or colleagues with the people whom you are considering entering into a partnership with? Are you convinced you can get along in a work environment?
• How will you resolve disagreements and make decisions regarding advertising, patient care, team management, and acquiring new equipment and technology?
• How will you divide up responsibilities within the practice?
• Is there enough physical space for more than one optometrist? Are there enough patients?
• How will you divide up new patients and exams?
• How are you going to determine compensation, such as 30% of individual collections, then 50% split on all additional income and costs? If one of you performs procedures with much higher lab bills, you may need to consider a lab payment option. These items will need to be written up by your attorney as part of your partnership documents.
• Do your legal documents include specifics on terminating the partnership? You will need to address details regarding non-compete agreements, disability or death, and how to sell a practice when one or both partners are ready.
• Do you know a good CPA who specializes in optometry practices and can assist you with setting up the entity or entities that make the most sense?

 
There are many items to consider to ensure that you make the right decision, but we can help make the process go smoothly with the best outcome for all parties. We have guided many medical professionals through purchasing and selling practices, partnerships, multiple locations, and every size and type of practice. We have the experience and the expertise to help you achieve your goals.
]]>Fri, 02 Jun 2023 07:00:00 GMThttp://omnipg-opto.com/blog/merging-an-existing-optometry-practice​If you already own a practice, have you ever considered buying an existing optometry practice located close to your first practice and merging the two together?  If you ask most doctors, they will say the best way to build a practice is through taking care of your patients and bringing in new patients via word of mouth and marketing.  And, they would be correct.  However, acquiring a second practice and merging the two together makes sense in many ways.
 
First off, have you ever calculated the cost of acquiring a patient via old fashioned word of mouth?  It requires a lot of work if you include everything from building your brand, training your staff, maintaining a spotless, high-tech practice, etc., the cost could easily be hundreds of dollars or more per patient.  The cost of acquiring a patient via marketing is even more.  Acquiring a optometry practice with existing patients can typically run from several hundred dollars per active patient to $1,000 per active patient.  Slightly less to maybe equal of acquiring a patient through a normal channel.  However, you get a high volume of patients very quickly in addition to adding income to your pocket.
 
Secondly, you acquire a stream of revenue at a near dollar to dollar relationship.  If the selling practice is producing $500,000 per year, you should be able to repeat the $500,000 in revenue by merging the practices together, or worst case, slightly below the $500,000.  The good news, is you don't bring over all of the expenses of the selling practice.  You typically can save in a number of ways including reducing staff of the selling practice, utilities are not double as the practices merge to one location, there is only one rent payment (more on that in a minute), only one set of books, so only one payroll service and one bookkeeper and accountant and several other services can be eliminated.  So, while getting the majority of the revenue to increase your practice collections, you only get a portion of the expenses.  This increases the income of the practice owner - you!
 
Thirdly, by acquiring another optometrist’s office, you reduce the number of practices in your area by one.  Less competition equals more new patients for you.  You can hire the selling doctor as an employee to help with the optometry transition as well as perform some other things that will help with patient retention.  
]]>Thu, 01 Jun 2023 07:00:00 GMThttp://omnipg-opto.com/blog/settling-credits-before-listing-your-practice​You’ve made the decision to sell your practice, and with that comes the to-do list of tasks that can often feel daunting. One important task that is often overlooked is settling patient credit balances. 

What are credit balances and where do they come from?

In many cases, a patient will have a credit on their account when their insurance pays more toward their treatment than anticipated or you estimated a patient portion to be higher than was necessary and collected accordingly.  In these instances, patients paid more out of pocket than necessary; therefore, the difference will show as a credit on their account and on your accounts receivable report or unassigned credit report.  Credit balances can also result from patients mailing in a payment or making an online payment on a balance that they have already paid.  These are duplicate payments typically made in error.  When this happens, we recommend contacting the patients and advising them of the duplicate payment before posting it to their accounts.  Many patients will request that you return their duplicate payment to them and some will elect to leave the credit on their account if they have upcoming treatment planned.  If they have upcoming treatment planned, this can be an effective way to get them on the schedule. It can be difficult to reverse an online payment and, in those instances, you may have to post it to the patient’s account.  In other cases, patients may pay upfront for larger treatment plans and due to unanticipated circumstances, they were not able to complete their full treatment or perhaps less treatment became necessary.  If you have a practice where patients with insurance are required to pay their patient portion due at the time of scheduling their appointment for treatment, then credit balances will appear on the patient account until the procedures are posted and until insurance has paid their portion, this is just the normal course of collecting patient portions upfront.  The same applies for patients without insurance if you collect the patient portion upfront.

How should I be handling credit balances?

To keep your credit balances at a minimum I would suggest you come up with an efficient protocol with whoever is in charge of your accounts receivable, whether it be your office manager, bookkeeper, or yourself.  Credit balances are typically handled by an office manager.  It is our recommendation that your accounts receivable report or unassigned credit report be reviewed monthly.  If there are outstanding claims on an account, no refund is due yet.  If there is a credit balance and there are no outstanding claims, we recommend contacting each patient and advising them of the credit balance.   And again, if they have been treatment planned for procedures ask each patient if they would like to keep the credit balance on their account and get them on the schedule for treatment.  If they have no upcoming treatment, it is typically best practice to refund the patient as soon as possible to keep your accounts clean.  Make sure to document these conversations about credit balances in patient notes.  This will serve you well in the long run when reviewing your reports each month for credit balances.  Some practices choose to monitor patient credit balances quarterly; however, if you are preparing to sell your practice, we recommend that you do this monthly.  You’d be surprised how quickly credit balances add up and how often they are overlooked.
 
One important note of caution!  When reviewing the credit balances on patient accounts, do not assume that the refund always goes to the patient!  You want to look back to the last zero balance on each account and look at patient payments made and insurance payments made.  Insurance companies make mistakes and sometimes they overpay and sometimes they make a duplicate payment on a claim.  In these instances, the refund is due to the insurance company and not to the patient.  Some insurance companies catch these errors quickly and request a refund in writing.  Others do not catch them so quickly and they have up to a year to claim their refund (this may vary from state to state).  Pay attention to this detail when reviewing accounts.  Remember to make notes in patient account notes so you don’t have to repeat your efforts every month.

I have not been settling patient credits on a regular basis, I have thousands of dollars in credits now what?

Follow the detailed recommendations above and get your accounts with credit balances cleaned up.  It is essential to do this leg work prior to the sale of your practice.  Make every effort to contact your patients to refund any monies due to them.  If the refunds are due to insurance company overpayments, contact them and ask that they send a request for refund letter.  If you are unable to reach patients with credit balances due to them, these credit balances in many states, must be reported to the state in which your practice is located.  For example, in the state of Washington credit balances over a certain dollar amount must be documented on an “Unclaimed Property Report” and filed with the state before November 1st each year.  Do some research and find out what your state’s unclaimed property reporting requirements are.

*Disclaimer: The information above is not legal advice. Each state has its own rules and regulations. Be sure to review all rules and regulations as circumstances may vary. ]]>Thu, 01 Jun 2023 07:00:00 GMThttp://omnipg-opto.com/blog/the-short-list-before-selling-your-practiceThere are many steps to selling your practice and your trusted advisors are here to help. Right now, I want to address just a few items that many doctors don't think about and that can lead to surprises.
Contact your CPA and/or Financial Planner regarding the following items:

1. Are you financially prepared to retire? Your transition specialist (broker) can assist you in determining the potential price of your practice and your real estate (if any).
2. Depending on your entity structure and past depreciation, what taxes will you owe?
3. Depending on your state, what taxes will you owe?
4. If you have any debt against your practice or real estate the debt will be paid at closing from your sales proceeds.
5. What will you do with the final funds? Do you have a retirement plan to maximize or does a 1031 exchange on the real estate make sense for you?

Again, there are many steps to selling your practice, but please address the above items to help reduce surprises.
]]>Wed, 15 Mar 2023 07:00:00 GMThttp://omnipg-opto.com/blog/how-optometry-practice-consulting-can-take-your-practice-to-new-heightsAfter years of intensive schooling and grueling exams to become a Optometry professional, running a successful practice may seem like a no brainer. Except all that schooling was designed to teach young professionals the ins and outs of optometry, not what is required to run a successful business; and that is just what a Optometry practice is, a business. The Optometry practice consulting offered by Omni Optometry Practice Group is designed to help take practices from mediocre to profitable.
What is Optometry Practice Consulting?
Running a successful Optometry practice takes a lot of work, much of which may not be immediately apparent. Expert consultants, such as those at OMNI Optometry Practice Group, will evaluate each practice to determine the best course of action necessary to take that practice and turn it into a profitable endeavor. A detailed analysis is performed and a plan is developed to increase practice production and collections, as well as developing prospectus, compiling management reports, helping with financing and lease assignments, and more. For those looking to sell their practice, or those who already have a buyer, OMNI Optometry Practice Group can act as a transitions consultant as well.
How Can Optometrist Benefit?
Through Optometry practice consulting, a detailed analysis looks at all aspects of the practice in question, from which suppliers are used, to the management team, and everything in between. An expert team then evaluates the Optometry practice's needs and goals to find out where the practice may need assistance. The information is used to develop a plan of action that will ultimately improve the overall success of the practice. The coaching experts at OMNI Optometry Practice Group have averaged a 20% increase in practice production and collections for their clients.
OMNI Optometry Practice Group has helped hundreds of doctors not only buy and sell their Optometry practices, but they have also helped to grow practices into profitable businesses through their Optometry practice consulting services in Washington, Oregon, and California. OMNI Optometry Practice Group are a leading provider of practice transitions and sales, valuations, consulting and real estate services, specializing in creative Optometry practice Transitions  and consulting.
For more information on how OMNI Optometry Practice Group can help to grow your Optometry practice through their consulting services, or to request a free consultation, please contact our team of highly trained and dedicated professionals. OMNI strives to ensure each clients' success, through detailed formal training and certification.
 ]]>Tue, 28 Feb 2023 08:00:00 GMThttp://omnipg-opto.com/blog/the-importance-of-optometry-practice-valuationsKnowing the value of a Optometry practice is a vital part of owning and running one. Knowing when to and then actually obtaining Optometry practice valuations; however, can be complex and stressful. The experts at Omni Optometry Practice Group understand how confusing the process can be and work hard to ensure as stress free experience, regardless of the reason for looking into valuations.
Common Reasons for Optometry Practice Valuations
There are several reasons doctors need to know the value of their Optometry practice. The most common reason is for Optometry practice transitions or sales. Valuations help to determine if the asking price is reasonable, to figure out a reasonable asking price to begin with, and to ensure the practice is profitable enough to invest in; this is also important to know when considering a merger. Doctors should also get their practice valuated within ten years of retirement and every two years after for estate planning purposes. Therefore, it is important to make sure the valuation is not a cookie cutter process.
Rule of Thumb Should Not Apply
No two Optometry practices are the same, so no two valuations should be the same. Often Optometry practice valuation are conducted using a rule of thumb method. The method does a major disservice to both the seller and the buyer, as it often does not highlight the practice's uniqueness and how that influences the actual value of the practice in question. For a true valuation, many aspects of the practice must be taken into account and evaluated by experts with extensive formal training and resulting certifications, such as the experts at OMNI Optometry Practice Group.
Experience Matters
When looking into Optometry practice valuations, it is important to make sure the professionals have extensive experience performing said valuations. The team at Omni Optometry Practice Group; example, have helped hundreds of doctors buy and sell their practices using accurate valuations based on the practice itself and are considered Optometry industry experts in practice valuations.  As members of the Institute of Business Appraisers and the Practice Valuation Study Club, OMNI Optometry Practice Group offers accurate and individualized valuations for Optometry practices in Washington, Oregon, and California.
To learn more about why and how Optometry practice valuations are conducted, or to request a free consultation in the Washington, Oregon, or California areas, please contact the expert staff at OMNI Optometry Practice Group. OMNI’s team of experts are dedicated to ensuring each client's success through transitions, valuations, consulting and other real estate services in the Optometry field.]]>Thu, 19 Jan 2023 08:00:00 GMThttp://omnipg-opto.com/blog/what-buyers-dont-want-in-a-optometry-practice-for-saleWe have talked about what buyer's want in the practice, but here are some things that buyer's hate to see.  
 
1.  High overhead - even though it can be corrected, this is something Optometry practice buyers often don't have the vision or knowledge on how to correct.  Even in high producing practices, if the overhead is too high, the buyers freak out.
 
2.  No way to increase the practice production or income.  If you are doing everything you may be maxing out the practice.  I'm not saying it's impossible to find the right Optometry practice buyer, but if you're doing all of the procedures, it can be a bit more challenging.
 
3.  Old practice from equipment to the shag green carpet and the orange laminate counters.  If it's been 30 years since you have updated anything in the practice, don't expect a premium price.
 
4.  Remote practice - A practice in a small town 3 hours from any major city is harder to sell than a practice in a desirable area.  Give yourselves 2 years to sell Optometry practices in remote areas.
 
5.  Relatives working in the practice.  It's okay to have a wife or child as an employee.  But if you have a wife, sister, daughter and son working in the practice and two of them will be leaving upon the close of the sale, you will have problems selling the Optometry practice.
 
These are some of the things to look at as you get closer to retirement, or just want to transition out of your Optometry practice.

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