By Brad MacLiver
Authorship and profile at Google
When a Vermont (VT) pharmacy acquisition has been accomplished by using the private financing method of a pharmacy business note, the holder of the pharmacy note inVermont
Most pharmacy business note sellers only look at the discount rate and quickly calculate in their head that they are giving up too much money to make the selling of theVermont
1. What is the motivation for selling the VT pharmacy note? What are the desired goals? Is reducing the exposure to risk a consideration? Is there a financial decision to pay off debt? Is capital required for a new venture? Are there dreams of exotic vacations or world travel that could be accomplished with a lump sum of cash? How important is it to accomplish these goals? What are the opportunity costs if you don’t have the lump sum of cash to achieve your goals, or invest in something that pays a higher return? Determine investment and family priorities.
2. What is the Current Fair Market Value of the pharmacy business? This is what someone is really willing to pay for the business, and not just an “earnings times x” formula. Real aspects of what is happening in the pharmacy industry must be considered and it is advantageous to have aVermont
3. How much cash is immediately required by the holder of the pharmacy note?
4. A pharmacy note in VT that is seasoned has more value than a “green” note that doesn’t have a payment history. Are you willing to hold the note for a certain amount of time to allow the business buyer time to prove to an Note Investor the capability of the payor making the payments?
5. Are you willing to sell only a portion of the Note (this is called a “Partial Sell”)? The discount rate can be a more attractive proposition when only a portion of the note is sold and the Pharmacy Note Investor is not holding all the risk.
Understanding Risks for the Note Buyer:
1. Pharmacy Buyer Competency: There is the risk that the pharmacy buyer may not run the business as efficiently as you have, sales drop, and theVermont
2. Pharmacy Industry Changes: Changes caused by influences either within the industry, or regulations governing the industry, can make it increasingly difficult for the pharmacy business buyer in VT to meet the contractual financial obligations.
3. Future Competition: Sales and income of the store may be affected by yet unforeseenVermont
4. Loan to Value: When originating a pharmacy business note inVermont
5. Title Insurance: Pharmacy business notes inVermont
6. Time Value of Money: Where a dollar received today is more valuable than a dollar received in the future.
7. Opportunity Costs: When the selection of holding theVermont
It is beneficial to discuss the options and potential origination of a pharmacy note with Pharmacy Business Note Investor before the Purchase and Sale Agreement is finalized for the acquisition of the pharmacy. This provides the VT pharmacy business seller, and future note seller, valuable insight into structuring the pharmacy business note so it can be successfully purchased.
************************
Authorship and profile at Google
When a Vermont (VT) pharmacy acquisition has been accomplished by using the private financing method of a pharmacy business note, the holder of the pharmacy note in
Most pharmacy business note sellers only look at the discount rate and quickly calculate in their head that they are giving up too much money to make the selling of the
1. What is the motivation for selling the VT pharmacy note? What are the desired goals? Is reducing the exposure to risk a consideration? Is there a financial decision to pay off debt? Is capital required for a new venture? Are there dreams of exotic vacations or world travel that could be accomplished with a lump sum of cash? How important is it to accomplish these goals? What are the opportunity costs if you don’t have the lump sum of cash to achieve your goals, or invest in something that pays a higher return? Determine investment and family priorities.
2. What is the Current Fair Market Value of the pharmacy business? This is what someone is really willing to pay for the business, and not just an “earnings times x” formula. Real aspects of what is happening in the pharmacy industry must be considered and it is advantageous to have a
3. How much cash is immediately required by the holder of the pharmacy note?
4. A pharmacy note in VT that is seasoned has more value than a “green” note that doesn’t have a payment history. Are you willing to hold the note for a certain amount of time to allow the business buyer time to prove to an Note Investor the capability of the payor making the payments?
5. Are you willing to sell only a portion of the Note (this is called a “Partial Sell”)? The discount rate can be a more attractive proposition when only a portion of the note is sold and the Pharmacy Note Investor is not holding all the risk.
Understanding Risks for the Note Buyer:
1. Pharmacy Buyer Competency: There is the risk that the pharmacy buyer may not run the business as efficiently as you have, sales drop, and the
2. Pharmacy Industry Changes: Changes caused by influences either within the industry, or regulations governing the industry, can make it increasingly difficult for the pharmacy business buyer in VT to meet the contractual financial obligations.
3. Future Competition: Sales and income of the store may be affected by yet unforeseen
4. Loan to Value: When originating a pharmacy business note in
5. Title Insurance: Pharmacy business notes in
6. Time Value of Money: Where a dollar received today is more valuable than a dollar received in the future.
7. Opportunity Costs: When the selection of holding the
It is beneficial to discuss the options and potential origination of a pharmacy note with Pharmacy Business Note Investor before the Purchase and Sale Agreement is finalized for the acquisition of the pharmacy. This provides the VT pharmacy business seller, and future note seller, valuable insight into structuring the pharmacy business note so it can be successfully purchased.
************************
