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Q: Will the buyer
purchase the stock of the existing company?
A: In general, because of the potential liability
associated with the drug industry, buyers do not buy existing stock. However,
each “deal” is unique and the sale of existing stock is a negotiation point
between the seller and the buyer
Q: Does
Washburn & Associates sell other types of businesses?
A: Unlike a business broker who will list any
business from a bar or restaurant to a manufacturer or retail store, Washburn &
Associates is a national company that specializes in pharmacies, and only
pharmacies. Although we are licensed and have the capability to sell any types
of business, we focus our efforts strictly on the pharmacy industry. This
practice makes us the premier choice to help our clients close their sale
quickly to a qualified buyer.
Q: Is
Washburn & Associates trying to list the store without really having a
buyer?
A: No. Washburn & Associates goes to great expense
in doing our acquisition searches. We absorb the cost of traveling to meet with
you, and to complete a site survey of your store and surrounding area. The "Hard
Analysis" alone commonly costs over $3,500 but you receive it at no charge.
We provide the buyer a complete professional
analysis at our expense, with no cost or obligation to you, the seller. Neither
the buyer, nor the seller pays any up front fees. We do due diligence on buyers
and determine their “seriousness” in completing a transaction before we
undertake these expenses. It would be an expensive way to "kick the tires" if we
did not have confidence that our buyers were serious about their acquisition.
Q: How do we determine a ‘fair’ price?
A: Washburn & Associates bases our calculations on
statistical data and industry knowledge of the local pharmacy climate, along
with years of experience, and hundreds of successful closing across the U.S.
Q: Can the price range change?
A: Yes. Price can change for a variety of reasons.
It is important that when we do the initial interview, we receive accurate
information. If information is misstated, the price range may be adjusted when
the hard analysis is done. Note: We collect the hard copies of the businesses
financials, tax returns, etc., to verify that the information presented to the
buyer is accurate.
Prices can also change when a seller decides to wait instead of pursuing the
potential transaction. Unfortunately the prices typically will be lower when the
seller waits for a later date. This can happen for three reasons. Washburn &
Associates is contacting you because a buyer has requested a store in your area.
It is always best to sell when there is a ready and willing prospect. Two, as
the pharmacy industry changes this can trigger changes in the pricing. A couple
of years ago independent owners commanded the highest prices the industry has
seen. Since then there have been corrections in the pricing, and buyers are
becoming more cautious. Three, there are fewer individuals buying pharmacies.
When there is a reduction in buyers, in any industry, there is a reduction in
price.
Q. How does the buyer finance the purchase?
A. Washburn & Associates can provide buyers with
numerous financial organizations ready to provide financing for qualified
clients at competitive rates. If you are interested in expanding your business
and require financing. please click here for
buyers information
or you may contact Jack Washburn at 804-725-2614 or
email:
jrwashburn@wildblue.net
Q: How long does it take to close?
A: The time frame will vary in every circumstance.
Once we receive the information from the seller, it takes Washburn & Associates
two weeks to conduct a hard analysis. An executive summary is then provided to
the buyer. Generally we receive a response from the buyer within two to three
weeks, as to their desires to move forward with the deal. As the deal
progresses, time needs to be allocated for license transfers, and the "Bulk Sale
Act" which allows creditors 30 days to make claims.
A minimum of three months should be considered, but a typical transaction will
take six months to complete. For larger buyers, the process is lengthier due to
corporate requirements Any lag in receiving requested information naturally
extends the amounts of time it takes to close the deal. Buyers require time to
review the business data. The transaction needs to be handled professionally,
cooperatively, and diligently in order to come to a win/win satisfaction for
both parties.
Q: Since
Washburn & Associates contacted the seller concerning a buyer that
was "looking in the seller's area," why does the seller pay the commission
instead of the buyer?
A: Buyers contact Washburn & Associates because
they know we have a greater understanding of the marketplace, and a reliable
consistent attention to the details associated with a new acquisition. We do the
acquisition searches and provide a professional analysis of the business at no
cost to them. This has lead to strong and ongoing relationships with many
‘repeat’ buyers.
By coming to you with a buyer in hand, we do not waste your time in trying to
locate a qualified buyer. Sellers that are serious about selling generally want
to get the process under way. We work for you and negotiate on your behalf.
We work for the seller to get the best price. Since most Pharmacists are not
accustomed to the intricacies of mergers and acquisitions, dealing direct with a
buyer may result in a distinct disadvantage to the seller. With our expertise,
we level the playing field, and are able to achieve a higher selling price.
Q: How is
Washburn & Associates able to continually receive higher prices?
Don't repeat buyers resist paying higher prices, or feel that they are over
paying?
A: By providing a professional analysis of the
targeted business, and absorbing the expenses to complete the initial stages of
the transaction without obligation to either the buyer or the seller, the buyers
see a real value in Washburn & Associate's service. Washburn & Associates saves
buyers time and expenses by completing numerous searches across the country at
no cost to them. The sellers' receive a better price, and the buyers do not end
up over paying, but instead pay a fair price for a business in a targeted area.
Due to our longevity in the pharmacy industry, and our numerous established
relationships, our buyers know that if they do not offer a fair price, Washburn
& Associates has the contacts and resources to take the deal to another
established buyer.
Q: What is the commission rate?
A: When the selling price is below one million
dollars, the commission is 10%. Your neighborhood business broker, who does not
specialize in pharmacies, typically charges 10% to 15% and generally does not
have a qualified buyer on hand. When the selling price is greater than one
million dollars, Washburn & Associates may negotiate slightly on the
commission.
Q. Does
Washburn & Associates provide
references?
A: Washburn & Associates has successfully completed
deals with many of the major chains along with numerous smaller regional chains,
and private individuals. We are members of the International Business Brokers
Association, licensed in Henrico County, VA under the name of Washburn &
Associates, a division of E-Com Consulting, Inc. Sellers may contact the state
of Virginia to verify that we are a corporation in good standing. We are happy
to provide names of past clients. However, due to "Confidentiality" and "Non
Disclosure" agreements, references from past transactions are only given to
serious sellers.
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