Practice Details

Income Status

TYPE OF BUSINESS:  CHIROPRACTIC OFFICE
CITY:       BLOOMFIELD       STATE:        CT
BUS. PHONE:  DO NOT CALL OR DROP IN WITHOUT PERMISSION

EVALUATED AT:  LISTING RATIO OF 4.06 = $125,652.00
SELLER’S ASKING PRICE:   $125,652.00

12 MONTH AV. (OVER 36-MONTH PERIOD) INCOME PERIOD: 01/19 – 12/21
COLLECTIONS: $390,445.00
NET CASH FLOW: $305,755.00 – Est. (AFTER ADDBACKS)
NEW PATIENTS 270
TOTAL VISITS: 13,026
RETENTION: 48.24
CASE FEE: $1,446.09
CASH PER VISIT AV: $29.97

Assets

General Information

EQUIPMENT, FURNISHINGS: $33,000.00
GOODWILL/INVENTORY (AT COST): (PATIENT FILES) $366,963.00
NON-COMPETE COVENANT: $3,000.00
SUPPLIES: COST $200.00
TRADE NAME: $-0-
LEASEHOLD IMPROVE: $40,000.00
TOTAL $443,163.00

YEARS ESTABLISHED: 50 YEARS
EMPLOYEES: 1 – CA
YEARS BY OWNER: 20 YEARS
TRAINING PERIOD: OPEN
DAYS OPEN: 0 HALF, 3-FULL DAYS
SELLER’S DUTIES: CHIROPRACTOR/MGR
HOURS OPEN: M-W 9:30-12:30/ 3-6
REASON: MOVING CLOSER TO FAMILY
TECHNIQUE: SPECIFIC PRONE – DIVERSIFIED

Comments

IT SHOULD BE NOTED THE NET INCOME TO DEBT SERVICE RATIO “LISTING” RATIO AVERAGE RUNS BETWEEN 4.02 TO 4.07. THE NET INCOME TO DEBT SERVICE RATIO OF 4.06 REPRESENTS THE FINAL “SALE” PRICE RATIO AVERAGE AND THEREFORE IS THE RATIO USED FOR THIS EVALUATION. NET INCOME TO DEBT SERVICE RATIO FINAL “SALE” PRICE AVERAGE RUNS BETWEEN 4.25 TO 5.50. SEE ENCLOSED COMPS. WITHIN THE
CHIROPRACTIC SECTOR, THE PRACTICE SALES COMPARABLES CAN BE TRACED BACK TO A PRECEDENCE. THE PRECEDENCE WAS/IS ESTABLISHED BETWEEN BUYER/SELLER AND THIRD PARTY FUNDER. FROM YEARS OF PRECEDENCE, A FORMULA WAS BORN – NET INCOME TO THE DEBT SERVICE RATIO. THIS RATIO IS BASED UPON CURRENT INTEREST RATE AGAINST NUMBER OF YEARS FINANCED. ONCE THE ANNUAL DEBT HAS BEEN ESTABLISHED, THIS DEBT IS SUBTRACTED FROM THE POTENTIAL NEW OWNER’S NET CASH FLOW OR, IN OTHER WORDS, TAKE HOME PAY BEFORE TAXES. WHAT REMAINS IS HIS/HER NEW TAKE HOME PAY AFTER DEBT SERVICE TO FUNDER. TAKE HOME PAY SHOULD BE NO LESS THAN 4 TIMES
(THE FINAL NEGOTIATED SALE PRICE RATIO NET INCOME TO DEBT SERVICE RATIO AVERAGE). IN OTHER WORDS, IF DEBT SERVICE IS $60,384.00 PER YEAR, TAKE HOME PAY WOULD BE CLOSE TO $245,371.00 BEFORE TAXES. THIS IS, OR HAS BECOME OVER THE YEARS, A COMFORT CUSHION (BASED ON FINAL NEGOTIATED SALE PRICE RATIO AVERAGE) TO THE FUNDER SO THAT FINANCING IS AVAILABLE TO ALL LOAN WORTHY RECIPIENTS. THE NET INCOME TO THE DEBT SERVICE RATIO IS THE RATIO WHICH DICTATES THE VALUE IN THE FINAL ANALYSIS. IT IS PURELY OBJECTIVE – NOT SUBJECTIVE. IT IS TIED INTO THE NET CASH FLOW – NOT TOTAL REVENUES. ALTHOUGH EQUIPMENT AND FURNISHINGS
IS AN IMPORTANT TANGIBLE ASSET FOR THE FUNDER, IT IS NOT A PRIMARY FACTOR IN ESTABLISHING A PRICE FOR THE CLINIC. FOR EXAMPLE: WHETHER A CLINIC HAS $50,000.00 IN EQUIPMENT AND FURNISHINGS OR $25,000.00 IN EQUIPMENT AND FURNISHINGS, IT WOULD NOT CHANGE THE VALUE OF THE CLINIC. THE VALUE IS DETERMINED BY THE NET INCOME TO THE DEBT SERVICE RATIO. THE BREAKDOWN OF GOODWILL, PATIENT FILES, TRADE NAME, COVENANT NOT TO COMPETE – THIS IS NOTHING MORE OR LESS THAN INTANGIBLES AND/OR NET CASH FLOW DISBURSED INTO DIFFERENT AREAS FOR TAX PURPOSES. ONE SHOULD NOT BE AS CONCERNED OR “HUNG UP” ON THESE ALLOCATIONS AS THE RATIO FROM NET INCOME TO THE DEBT SERVICE RATIO. THIS IS THE “TELL ALL” RATIO WHERE ONE CAN TRULY COMPARE CLINIC-TO- CLINIC OBJECTIVELY. NET INCOME TO THE DEBT SERVICE RATIO IS THE STANDARD WHEREBY COMPARABLES EXIST TODAY. COMPARABLES ENCLOSED. THIS EVALUATION REPRESENTS REVENUES FROM ONE (1) LOCATION. ALL MAJOR EQUIPMENT LEASES (IF APPLICABLE) TO BE PAID IN FULL BY SELLER AT TIME OF SALE. IN OTHER WORDS, IF PRACTICE SOLD TO ANOTHER PARTY, THE $305,000.00 WOULD INCLUDE ALL MAJOR EQUIPMENT AND FURNISHINGS

TO RESEARCH LOCATION, INSTALL GOOGLE EARTH FROM: http://earth.google.com/download-earth.html or http://www.city-data.com/

THE SELLER HAS SUPPLIED THE ABOVE INFORMATION. SGR, INC. HAS NOT INVESTIGATED ANY OF THE FACTS ABOVE. SGR, INC. SUGGESTS BUYERS RETAIN ATTORNEY, ACCOUNTANT, OR ANY OTHER ADVISOR TO VERIFY ALL OF THE ABOVE INFORMATION SUPPLIED BY THE SELLER.