In these uncertain times, many independents are looking to sell their pharmacies. Many sellers have not been through this process before. Tax advice should be taken before selling to allow time for proper tax planning.
Sellers need to:
- Tidy up the business before offering it for sale. Ensure that the tax and other obligations are fully paid to date, accounts are up-to-date and filed with relevant authorities and staff contracts are in place. Providing historic and current financial information at the outset will ensure that the sale process is much quicker and stress free.
- Ensure that at least 3 years or more of accounts, VAT returns, FP34 statements and Payroll/PAYE records are available.
- Establish a growth trend – show growing trend in script numbers, great customer service, offering additional services (MUR, NMS, smoking cessations etc.).
- Ensure that gross profit margin is within the benchmark for all pharmacies. The higher the margin, better the net profit and final value.
- Manage staff and other costs (again within the benchmark for pharmacies) such that net profit is higher. This will help increase the value of your pharmacy.
- Have a modern looking appearance with improved signage and entrance to pharmacy.
- If a pharmacy is operated from leasehold premises there should be at least 10 years to run on the lease. If it is operated from freehold premises and this is available for sale at the same time, it could be an attractive proposition for the buyer. Alternatively, it could be leased to the buyer which would be a source of rental income.
- Obtain an accurate, comprehensive, unbiased and clear valuation of the pharmacy business.
- All of above should help increase the value of the pharmacy.
Thinking of selling? Please contact Sanja on 020 7380 3446 or email to email@example.com