Southwestern Colorado Practice for Sale | Cortez Family Acupuncture

The City of Cortez is located in the high desert Four Corners region of the Southwest.
Competition is sparse, and the combined population of all counties in the service area (including Colorado, New Mexico, Utah and Arizona) is well over 350,000 people.
Santa Fe, Albuquerque, and Denver are all accessible by car or commuter flights 3 times a day (frequent flyers can purchase voucher packs for about $100 each way).
Cortez is the gateway to stunning and iconic Mesa Verde National Park, located 11 miles to the east; Ute Mountain to the west; and the San Juan mountain range to the north frame the city’s sunsets and vistas.
The area is home to many archeologists, National Park Rangers, ranchers, and natural gas workers.
Retirees and seasonal residents are also plentiful owing to the sunshine (240 sunny days yearly!), dry weather and cool nights, as well as boundless opportunities for outdoor recreation; ski slopes and single-track trails, rafting and endless hiking are plentiful and close by.
The1000-square-foot office is located in a turn-of-the-century house on a corner with ample parking. It is sunny and spacious, with a large waiting and reception area, 3 treatment rooms, a back office and 2 bathrooms.
The clinic is located near the center of downtown Cortez and close to multiple medical practices. The building is stand-alone, and its large sign is on the corner, visible from Main Street.

CFA is a non-specialty practice, where we see everything from subclinical and acute orthopedic conditions to chronic issues that have not responded to other medical interventions.
Most of our patients come seeking rapid pain relief, and generally our approach is problem-focused, befitting our rural, older, often working-class clientele.
The patient population has spanned from infants to great grandparents, and everyone in between. That said, the current patient load mostly consists of women between the ages of 40 and 60.
Our patients come from a wide geographic area, up to 120 miles from our office, though the majority are within the county, typically a 20-minute drive or less.
We currently average 36 treatments per week, and we have had 169 new patients over the past 12 months.
Approximately 65% of patients pay cash and 35% have insurance.
While our exceptional Web presence brings in many new patients, our visibility and word of mouth plus local practitioner referrals account for the vast majority of new patient visits.
The current owner is happy to provide years of past calendars to prove consistent patient volume.

While trained in TCM acupuncture, we heavily employ Dr. Tan, Master Tung, and Japanese acupuncture styles as well.
The current owner has also developed a distal point spinal alignment system called Backupuncture®. (A new owner could be trained in these techniques.)
We prescribe herbal medicine and have an extensive pharmacy of tablet and tea pill formulas, primarily from Health Concerns & Mayway.

The following income and expense summaries are derived from averages from the end of the second quarter of 2015 to the end of the second quarter of 2018. Note that the current owner works a maximum of 34 hours per week and takes several weeks off per year.

Income

Average gross (2015-2018): $145,600+ ($12,130+/mo)

Expenses

Average adjusted expenses: $31,965 yearly (~$2,664/mo)

Adjusted expenses are the net expenses that a new owner would have to take on in order to run the business at the same level of revenue as the current owner.

Net Income:

Average $113,700/year (~$9,475/month) – Almost 80% of revenue is profit after expenses.

$122,500 OBO. Our price is based on a conservative professional valuation of over $130,000 in 2016 when our gross revenue was $134,000.
Gross revenue in 2017 was $163,000, with 2018 on track to perform similarly, warranting a higher valuation.
Our motivation to sell in a timely fashion has allowed us to generously factor in a 25% discount off of the lower-valued price for potential attrition and start-up costs on change of ownership. We expect the right person will retain our patients and transition smoothly, making this a great opportunity for the buyer.
Approval of the buyer is subject to a credit check, and loans from medical practice brokers, banks, or the Small Business Administration (SBA) may be available to finance the transaction depending on the buyer’s creditworthiness.
The seller may also be willing to hold the loan given a 50% down payment from the buyer.
The purchase will be structured as an asset purchase agreement and may be drawn up between buyer and seller (preferred) or by attorneys, at the discretion and by agreement of both parties. The owner has an agreement previously drawn up that can be modified, avoiding significant expense.
Upon purchase, the new owner will receive all patient records and equipment, in addition to any supplement inventory.
The current owner will also transfer to the new owner all clinic-related intellectual property, including the clinic phone number, website, Facebook page, claimed Yelp page, Google page, billing and electronic medical records, and clinic-related financials.
The current owner is also the landlord of the building, so the lease is fully transferable. Or, the building may be purchased by the buyer as a separate agreement (though may be attached to the business purchase and sale for financing purposes of the buyer, if desired).
The current owner’s goal is to surrender the practice by the end of the 1st quarter of 2019. He would be willing to stay on for a limited time to train a new owner in his techniques and to assist in the transition at no additional cost.

While the current practice nets a healthy return, a motivated buyer could significantly increase their income upon acquisition through a number of simple changes.

Work more hours. Given that the current owner only works up to 34 hours per week, the schedule is often full and not all patients are able to be accommodated. Working more hours would obviously increase revenue with no additional marketing--simply by capturing our current overflow.
Add additional practitioners. In addition to or in lieu of working more hours, the practice could easily support at least one more provider during the times when the office is unoccupied.
Do some marketing. We do very little marketing outside of our web presence. We have a database full of patient information that could be used for marketing directly to current and former patients, but we have been busy enough that we haven’t been using it. Doing any kind of additional marketing would create more opportunities for an increase in new patients and a return of pre-existing patients.
Improve online presence. The current owner has been successful without putting too much effort into creating an online presence. Blogging, improving the website, paid online marketing, and doing some email marketing all hold great potential to improve awareness of the clinic in order to generate more revenue.
Sell more supplements. Less than half of our patients currently take a limited amount of supplements. Giving a greater percentage of patients the option of a larger range of supplements offers another opportunity for significantly increased revenue.

Some select photos of our beautiful office...

The entrance to our beautiful clinic. (We are open to selling the building as well!)

The waiting room and front desk.

A view into one of our three treatment rooms.

Second treatment room.

Treatment room #3.

Bathroom 1 of 2.

Yes, a second bathroom!

Unique opportunity to own an amazing high-net acupuncture practice in Colorado

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