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Showing 1 to 5 of 6 articles related to "purposes".

Value & Price: Are They The Same?

What's the difference between value and price? Surely, the value is what someone is willing to pay for the business! Or is it? And, does the difference justify the investment or matter?

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Pharmacy Returns - are pharmacy returns reasonable

PBS Reforms combined with the impact of the recent credit crunch have driven many pharmacists to ask the question - should the prices being paid for pharmacies come down? In the context of the current economic climate, many expect that returns should increase to reflect the increasing uncertainty and/or risks about pharmacy. But is this the case?

Pharmacy returns

Pharmacy business sales brokers generally refer to the capitalisation rate as the return on investment. But is it?

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Pharmacy Partnership

Due to increasing business size and value, and the need for succession planning, owners with viable businesses are seeking junior partners to join them. Likewise up and coming pharmacists wish to own larger businesses.

Such sales of equity will necessitate the development of industry-accepted principles and finance approaches for succession.

Practices have used multi-practitioner professional partnerships to attract appropriate staff and rewared specialised skills. Pharmacists, like other professionals, are seeing the evolution in the admission of junior partners. Also, with almost 60% of existing practitioners ready to retire in the next 10 years, partnerships will become a practical way for the profession to retain their skills.

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Why Do I Need A Business Valuation

A Business valuation is the process applied by a qualified valuation expert to determine the fair market value of an owner's interest in a business. As a current or prospective pharmacy owner, a business valuation will provide you with an analysis of the pharmacy's value along with the strengths and weaknesses inherent in the business. The purpose of this article is to identify the concepts behind valuation in pharmacy as well as the reasons why a valuation would be conducted.

There are many reasons why you may need a valuation as a pharmacist. Some of the main reasons are to raise capital, protect your business, for estate planning purposes or buying and selling a pharmacy.

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Pharmacy Valuations

Different circumstances require different business valuations. In pharmacy, re-financing, new partner acquisition and purchases require different methods of valuation to account for changes in style of the operation of the business. Medici Capital is the industry leader in pharmacy valuations and takes these factors into account when valuing a pharmacy.

There are three methodologies for pharmacy valuation:

Method: Explanation: Uses: Discounted Cash Flow (DCF) The pharmacy value is the present value of the future cash flows from that business. Pharmacies with a finite life or varying annual cash flow. Capitalisation of Future Maintainable Profits Maintainable profits are estimated and capitalised using long-term market or industry discount rates. Pharmacy with a presumed "infinite life". Assets plus Goodwill The going concern value of assets plus goodwill for expected future income. Relatively new pharmacies or where future cash flows are uncertain.

The choice of methods depends on the ability to forecast revenue and expenses and the purpose of the valuation.

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