Whether you’re just starting out in chiropractic practice or have hit a comfortable stride in your business, it is never too early to start thinking about one big transition: what will happen to your business when you are ready to stop practicing.
Don’t forget that old saying: “When you start something, you should have the end in mind.”
I encourage you to get off this treadmill of success that has had you running since the day you started your practice and think about reality. You and your practice cannotcontinue forever.
If you are serious about making a positive transition, then you have probably already taken some proper steps to ensure stability for you and your family, staff and patients. The first step is making sure your family is protected. That means writing up a will or trust, plus a prepaid funeral plan and a signed power of attorney. You need a life insurance policy that covers any indebtedness, personal or professional, and still leaves your family not wanting.
If you want to be truly prepared, you’ll also purchase an income protection plan in case you are disabled. Thank goodness I had one when I had my heart transplant. That policy paid me $60,000 a year for five years.
You also need to get very transparent with your family and especially your spouse about financial responsibilities. Make sure all titles and assets have co-ownership or are entitled under the trust, and that your family knows your attorney, accountant, financial advisor and investment broker, and has full contact information for and access to all.
Passing your practice on: Three ways to make the transition
There are many paths off this main road of selling your practice. Which one will you choose? I will cover three common scenarios:
1. Go to a bank and help a young doctor get a loan: Going to a bank with a new doctor, showing them your financial structure for the last few years and expecting them to loan him or her the money to buy your practice is impractical. Most applicants are probably already a quarter of a million dollars deep in student loan debt, and the bank might consider your income (or the young doctor’s future income) a “blue sky” loan with no equity. So no, they are probably not going to offer a loan.
2. Sell to a chiropractic corporation: Do you just want cash? Your location, patient base and consistent production will get bankers interested in you. If they buy your building or solidify your lease agreement, their main goal is to make a profit greater than you did. So, yes, if you want cash, take it and be happy, but know that sometimes they have a condition in which you must stay on and work for them for a given amount of time. They might dictate how you run your office, demand you see a certain number of patients a week, or a specific number of new patients per month. They may change the direction of your practice and what it represents. They may add techniques and other alternative care, or sell products and services other than chiropractic. You must decide what is best for you and your family.
3. Mentor a replacement: If your purpose has always been to sell your practice in a way best for your family, mentoring your replacement has been a solid transition formula for many years.
How to choose a candidate
Stop a moment, sit down and think about this: You have practiced by yourself for many years. You have survived all the mistakes you have made. You have built a trustworthy reputation in your community, and out of concern for your future you have built a protective wall, or invisible bubble around your practice. This subconscious mental wall is based on your not drifting from providing a consistent positive response to your treatments and minimizes the chance of anybody or anything disrupting the heartbeat and flow in your clinic. It is frightening to think that you are going to bring a total stranger into your protective bubble, someone who could disrupt everything. How are you going to respond? They will shadow you, and you will have to change the flow of your daily schedule as you train them to be a mirror of yourself.
How good a teacher can you be? Can you put into words what you have intuitively learned through years of clinical touch in application? Chiropractic is a clinical art. Will this candidate see what you see when you look at X-rays? Will their hands perform the techniques in the wayyour patients are accustomed to? Will the candidate be willing to accept all the stress, expectations, commitments and obligations of running a successful business? One thing is for sure: Uou must find out if they are teachable and compatible.
It would not hurt to put yourself in their shoes as the “new you” strives to start your biggest adventure. Would they like to live where you live? Is it rural? Is it in a busy city? Is it a vacation town? Do any other relatives live close by? Do they like the weather patterns for the year? What are their hobbies and what do they like to do in their spare time? Is there affordable housing? What is the cost of living in your region?
Fear not! Step out of your bubble. The colleges make it quite easy for you to get associated with younger doctors even before they graduate; they call this the preceptory program. Once you contact the colleges, they can send you candidates you can interview and see which ones you might like to have in your office shadowing you. Some of the colleges give credit for up to three months for that chosen student mentoring with you.
You may have been in practice long enough to have a patient or a patient’s offspring who received a life-changing positive response to your technique. Perhaps they will come to you and say this is what they want to do for the rest of their life. That person would be an excellent choice because they would duplicate the care you gave them in your office that changed their life. They own and trust that type of chiropractic care. They want to share that technique with the world. That person would be a perfect protégé. Being in healthcare is a calling, not just a job. Isn’t that the same reason you came into practice? You have that passion for the care you rely on for your health and family.
Sharing that same passion with your candidate is just one leg on the foundation that will make this transition successful.
Final thoughts on your transition from practice
Transitioning out of practice is a journey, one that can benefit both individuals. It requires communication and determination. “All successful chiropractic practice sales or transitions end in the same way: with a written agreement. Yes, it requires an agreement on price, financing, transitional terms and more. Regardless of whether your plan is to sell, offer an associate, buy in or buy out the partnership or transition office option, the process is not complete until you get it in writing.”
Remember that your first choice may not work out, and it may take you two or three attempts before things click. Let us start the process.
Gary A. Boring, DC, BCAO, (Board Certified Atlas Orthogonal), FICA, LCP(Hon), has been in practice for 53 years.
