As most business owners know, having a solid team around them is imperative to success. What most practice owners don’t realize, however, is that your team should extend to people beyond those who work in your practice.
The truth is, there are many experts who can help you take advantage of things that you may not even know exist, with the end goal of protecting you and your hard-earned dollars.
Oftentimes, practice owners may have a business partner, or want out of their partnership with as few consequences as possible. Just like any relationship, starting a business partnership with someone should be examined and carefully thought out, with many caveats put into place.
The most important factor in a partnership is the NON-NEGOTIABLE existence of a buy-sell agreement.
We spoke with Peter Tanella of Mandelbaum Barrett PC, an expert of 15-years when it comes to buy-sell agreements for vets, about what you need to know when deciding to take on a business spouse.
We’ve broke down the top things you need to know when entering into, or leaving a buy-sell agreement.
1. Make sure your attorney is the proper kind of attorney.
-
- Attorneys are not one size fits all. Much like you wouldn’t go to a heart surgeon for a brain tumor, you need a lawyer that specializes in contracts and purchasing/selling businesses.
2. You need to have the proper language in your buy-sell agreement and create your roadmap NOW.
-
- You need to spend time and money upfront to ensure that you have the right language in your agreement.
- Creating your roadmap now will alleviate possible headaches in the future in case you decide you want out.
- Decide on important issues such as what you’ll do if you want to retire but your partner doesn’t.
- Murky language in an agreement can cause you to spend more time and money negotiating later on.
3. As business grows, you may need to amend your contract.
-
- Even in the best of times, you may need to plan for the negative. When your practice is growing and making a lot of money, you may need to re-examine your agreement to make sure it reflects your current situation.
4. Figure out how decisions will be made.
-
- In a practice with multiple partners, it’s important to decide how decisions will be made. For example, if a corporation comes to you with an offer and you want to sell but your partner does not.
- It can be beneficial to delegate someone ahead of time to assist in making decisions that will act as a neutral party.
- Financial decisions, such as borrowing money or buying equipment, should absolutely be spelled out beforehand.
5. Get Specific.
-
- If you exit out of your practice without your partner, you need to have language written in your contract about how the money will be transferred.
- If a partner were to git sick, or die, you need a plan in place as to what happens to their share of the practice – especially if that partner is married.
6. You MUST get the practice evaluated before exiting your practice.
-
- What happens if you would like to sell your share of the practice to your partner, but they think it’s worth way more than it actually is. You have to work with realistic numbers when exiting a business.
7. Educate yourself.
-
- Whether it’s insurance for the practice, a buy-sell agreement, or your personal investments, have an expert explain all terms and conditions to you, so that you’re aware of exactly what you’re entering into.
Avoid the stress of having to figure out complicated buy-sell agreements yourself, and eliminate the anxiety of “what if” situations by hiring the experts to do the leg work for you now.
Once you have the security of knowing that things on the back-end are taken care of in the case of a multitude of events, you’ll be able to breathe easier and make rational decisions when it comes to your career.
Securities products and advisory services offered through Park Avenue Securities LLC (PAS), member FINRA, SIPC. OSJ: 4200 West Cypress Street, Suite 700, Tampa, FL 33607, 813-289-3632. PAS is a wholly owned subsidiary of The Guardian Life Insurance Company of America (Guardian), New York, NY. The individuals associated with Florida Veterinary Advisors do not maintain specialized licenses or qualifications for the financial services provided to veterinary professionals. Florida Veterinary Advisors is not registered in any state or with the U.S. Securities and Exchange Commission as a Registered Investment Advisor. Florida Veterinary Advisors is not an affiliate or subsidiary of PAS or Guardian. 2024-169764 ex 2/2026.