Buying an existing practice or setting up a new practice can be incredibly daunting! But surrounding yourself with professional experts will smooth the way.
In this article, Credabl’s Ali Joyce takes a look at the advisors who can help you, how they can help and why you should engage their services.
Accountant
Setting up all structures correctly from the start is essential so you don’t get stung later on with taxes you could have avoided. Getting advice on what is right for your specific circumstances is also incredibly important, after all, what works for your business, may not work for another. Talk to an accountant about the pros and cons of different entity types such as companies, and trusts versus being a sole trader. Your primary outcome is to maximise tax deductions and reduce the tax you pay. An accountant can also help you future tax plan and map out your tax instalments, so that you don’t get hit with a big tax bill after your first year of business.
Financial Planner
A financial planner will provide advice around your short and long-term financial goals and can also work alongside your accountant and financier with tax planning, asset allocation, risk management, retirement and estate planning. During this process, your financial planner will review your life and income insurance to ensure it is adequate – this is vital when you are planning to take on debt to own a practice.
Financial advice is a requirement when investing in commercial property through your self-managed super fund, or SMSF. When taking out goodwill debt to buy a practice, you may also be asked for adequate life and income insurance to cover the debt and loan repayments. This is where a financial planner can help.
Lawyer
Investing in legal advice upfront can potentially save you from unexpected and difficult situations in the long run. The legal documents involved in buiying or setting up a practice can include a trust deed, partnership agreements, shareholders agreements, lease agreement, employee contracts, and business purchase contracts. Lawyers can prepare these and assist with reviewing any documents you have received from third parties.
Buyer’s Agent
A buyer’s agent, or buyer’s advocate can help you find a commercial property in the right location, at the right price. They can also negotiate with the selling agent on your behalf. The key difference between a buyer’s agent and real estate agent is that they work for you, not the seller.
Business Broker
A local business broker who specialises in selling specialist medical or optometry practices is the best person to help you find an existing practice to buy. You’ll be able to tap into the current suitable practices for sale or register your interest for upcoming practices. As a ‘middleman’ between you and the seller, they will provide you with a full information memorandum on the business, its financials and provide a price guide if you want to put an offer in.
Settlement Agent
Don’t buy a practice or commercial property without an experienced settlement agent who can work with all parties to ensure the settlement happens on time. They will ensure all relevant funds are handed over and all forms are lodged for stamp duty if applicable in your state. Additionally, they will make sure any debt on the business you are buying is cleared and relevant charges are lifted so that you son’t become liable for someone else’s debt.
Insurance Broker
There are many insurances required when purchasing or setting up a practice. The best way to manage these is to go through an insurance broker with experience in optometry who can provide advice on the products you really need, collect quotes from the multiple suppliers out there, and help you identify the best solutions. When funding a commercial property, lenders will always ask for a copy of the certificate of currency and, on occasion, will also ask for contents insurance details.
Specialist Lender
When it comes to buying or setting up a practice, using a lender that understands your industry will make the process much easier. They will help you understand the loan structure, repayments and affordability anad even connect you with all of the above experts and industry suppliers. As an optometrist or ophthalmologist, your time is incredibly valuable, so using a specialist lender such as Credabl will take the stress out of the process with minimal paperwork and quick turnaround times.
Check out Credabl’s Private Practice Checklist to get a full picture of what’s required when setting up on your own, and how you can get a head start on your journey.
Remember
It’s essential to check the credentials of any advisor – and whether they need to be licensed to provide advice – before engaging their services. Check any testimonials and pursue recommendations from individuals or organisations who have used the advisor for the same or similar services.
Ali Joyce is a Finance Specialist at Credabl with an organised and thorough approach, backed by extensive experience helping eye care professionals to secure the finance they need for practice acquisition.
