If you’ve operated your own drug store or pharmacy for a number of years, then you keenly understand what it takes to be successful. You have a love of people and an understanding of procedures, regulations, guidelines, licenses, and all of the other things that are unique to this particular business. You know that once you found your groove and mastered all of the ins and outs of your business, it proved to be an extremely rewarding profession.
Still, there may come a time when you’re ready to sell your drugstore and move on to another opportunity — or to retire.
The first thing to note is that, even if you’re only in the beginning stages of considering putting your business up for sale, it’s never too soon to plan for it. In this article, we will outline some of the details you’ll need to get in order to
Set your exit timeline
Once you’ve made up your mind to sell, set a timeline that is reasonable. Plan for the details you’ve thought of as well as those unexpected or forgotten ones that will inevitably come up. By setting a timeline, you can stay on track and avoid the trap of continuing to postpone your for-sale date.
Furthermore, strategic planning will pay off in helping you to maximize the value of the business to potential buyers.
If you’ve been in business for a long time, you tend to forget all of the relationships you’ve built that are integral to keeping your business running. When relationships are well-established, proper contract renewals and other documentation sometimes go by the wayside.
Make sure to review all of the contracts and licenses that apply to those you do business with and bring them up to date. You’ll also need to determine what these business partners will require of a new owner once your business is sold.
This pertains particularly to insurance companies with which you conduct business. Each may have different requirements, and your buyer will likely need to reapply with each provider to continue accepting their insurance once you’re gone.
Assess the financial situation
When selling any business, it’s important to hire someone to conduct an independent audit of all of the financials. Drug stores are no exception. Doing this will protect you and will reassure the buyer that they’ve been presented with a fair, accurate, and unbiased view of the state of your business.
This process will also help you to fill any gaps in your record-keeping and clean up any records potential buyers will want to see. If there are issues, it will give you time to look into what caused them, so you can be prepared for any questions about things such as an uncharacteristically profitable month.
Serious buyers will want to see your drug store’s revenues, expenses, and profits. It’s a good idea to have at least three years’ worth of pristine financial and tax records to share with seriously interested buyers. The more information you can provide and the more transparent you can be, the better.
Spruce it up
Always remember that first impressions matter. Just as you would if you were selling your home, consider the curb appeal of your business: make sure that your drugstore and everything in it is tidy, attractive, and clean, and make any necessary repairs. Ensure that all lighting and signage are in working order. Make the parking lot, entrance and any surrounding areas you own look appealing and inviting.
Valuate your drug store
When you’re setting a price for your store, it can be hard to separate its actual value from the blood, sweat and tears you’ve poured into it over the years. Still, those intangibles are hard to justify to a buyer. Do your market research and focus on the current market. If you are struggling to set a price, or you find that you’re getting no traction on the asking price within a month of placing your business for sale, consider having your drug store independently valued and assessed.
Hire the necessary professionals
In addition to a financial expert to help you with those items mentioned above, it’s a good idea to have a legal representative to help you at least review — if not draft — your purchase agreement. Oftentimes, we only think of using legal representation when we’re buying a business, but it’s equally important on the seller side.
You should also consider hiring a business broker to list your drug store for sale once you’re ready to do so. A business broker can help you market your drug store to attract more, and higher-quality potential buyers.
By crossing all of these items off of your to-do list, you’ll ensure that the process of selling your drug store is as stress-free as possible, and you’ll increase your chances of finding an ideal buyer.