Buying an Existing Veterinary Practice May Be Better

Karl Salzsieder, DVM, JD, CVA, Owner of Salzsieder & Associates, TPSG, LLC / DBA Total Practice Solutions—­Northwest, discusses why it’s better to buy existing veterinary practices rather than starting a new one.

Interview Transcript (slightly modified for readability)

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“Actually I would agree with that question that yes it’s better to buy existing [practices]. In general, with exceptions of a few demographics where there’s major industry growth areas where the city is just growing out houses, other than that, I would strongly recommend that they don’t start more veterinary hospitals because commonly there’s too many already.

And, as you say, if you start a new practice you can go 2 years plus in time before it becomes cash flow positive, so you’re better off to spend your money for an existing practice that has cash flow, clients at the door, and immediately you can be in the black if you buy the right practice for the right price, which obviously should be valued by an evaluator, rather than just some random price, like the falsity of 30 years ago that it was worth a year’s gross that is now based on earnings. So, that doesn’t apply anymore. Those issues are very important.”