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Wellness Capital Management is pleased to offer an in-depth complimentary 30-minute Wellness Business Consultation.

 

Business Curb Appeal

In the past month, we’ve been contacted by spa and practice owners who have been approached by potential buyers. They want to know what their business is worth and how to sell.  We’ve also been approached by buyers who are looking to purchase spas and medical practices but don’t want to pay too much. These questions go well beyond merely placing a value on a business.  They address the issue of how prepared a business is to sell or a buyer is to buy.  We believe that the process of buying or selling begins with Curb Appeal.

You have two minutes to make a first impression. CURB APPEAL is the first impression you have of a seller or buyer in buying or selling any property, business or practice.  It is the way commercial or residential real estate is sold, but is unfortunately often overlooked when selling a spa or medical practice. Curb Appeal is critical and valuable, and will make the transaction a wholly different event if handled correctly. 

Selling a business is a competitive event and your business opportunity should be positioned to stand above the competition. Curb appeal is what the buyer’s mind evaluates when you share information about your business with them.  The first person who sees this information may not always be the actual buyer.  It may be a friend, investor or financial consultant who has been asked to “keep their eyes open” for an investment that “makes sense”. Once this person has a chance to review the presentation, their first impression will then be passed back to the buyer if they deem it worthy of consideration.  Curb Appeal should simply be a seller’s best foot forward. If the seller is evaluating the buyer, Curb Appeal is the presentation of a buyer’s professionalism, financial information and operating experience. Curb Appeal of the buyer gives the seller confidence that the buyer can complete the transaction and operate the business successfully.

PHYSICAL CURB APPEAL is where the condition, appearance and ‘feel’ of the facility come into play.  Guests of the spa and clientele of your practice have a visual point of reference and thus this is the lifeline of your business.  What do they see and sense? Does your first impression reflect the description of your mission statement in buying a spa or the spa you are selling?  If you look deeper at the condition of the physical plant, does it scream “I am well maintained and details are taken care of”?   Does the facility speak to the type of operator you have been over the years?  The physical condition of your spa will define your spa and go a long way towards substantiating its value.

MANAGEMENT CURB APPEAL allows you to wow the buyer with your style of management.  Does the practice or spa speak as a well oiled machine?  Front desk energy, staff appearance, an inclusive and hospitable attitude, salesmanship and retail POP are all components of Management Curb Appeal.  Does the next layer of management speak to organizational skills honed over the years?  Does Management Curb Appeal show viable management systems that look professional and can be easily transferred to the new owner?  All these items increase value and rationalize a higher price the buyer will be willing to pay.

FINANCIAL CURB APPEAL is the final and most important piece of the Curb Appeal agenda.  When the financial statements and records are presented, what impression do they make?  Are they organized in a manner that paints the financial picture in a credible manner?  Do they make financial sense?  The goal is to anticipate and eliminate any objections that the buyer or more rightly said … financial advisor may be looking for.  The financial statements should make a positive impression on the buyer.  Strong Net Profit, positively trending sales and rock solid assets with positive equity have a dramatic impact on the buyer and affect value.  Real estate is a fantastic anchor for any transaction.  Has the business entity been positioned correctly to take full advantage of available tax benefits? Financial Curb Appeal takes planning and time to create. Spa or medical practice financial experts can tailor them to be a strong advocate of your sale. 

BUYER’S CURB APPEAL takes the form of a carefully crafted business plan.  This plan includes a clear description of business intent, the buyer’s experience and financial condition. Like the Financial Curb Appeal that a seller must present, this statement of financial condition should anticipate and eliminate any objections the seller may have. These may include the source of financing for the purchase and any issues that affect the buyer’s credit score.

SUMMARY:

As you can see, the transaction actually starts years before the event of the sale.  This set up starts on the day you purchase or open you business.  Then, the foundation is built for the time when a sale is contemplated.  Curb Appeal is not flowers at the front desk or a hastily prepared set of financials. It is a carefully orchestrated process and set of attributes that reflect the value of your spa or medical practice.

Wellness Capital Management handles the Transaction Consulting to sell your spa or practice.  We prefer to start the process by being a part of the original purchase.  Call us to see how we can become the primary leader in your team of experts as you move to buy or sell a practice or spa.  We will supervise and hire the local broker, attorney, tax accountant and escrow personnel … all for about the same fee that a business broker would charge.  We want to lead your team as you buy your next property or you plan your exit strategy.

Call 888.727.5489 or e-mail us at Monte@WellnessCapital.com.