What Is My Practice Worth? (How to Measure It)

The traditional model of the physical therapy practice is pretty simple to understand: you consider the worth of your private practice by the annual gross revenue, right? What is the proper approach on how to measure the worth, your practice, regardless of some of those tangible or intangible assets?This week's The Dave Kittle Show episode, Dave Kittle goes solo and talks about how to measure the worth of your private practice using the accounting method, and how this method can benefit you in your practice, regardless of its size, scale, location or multiple locations. This presentation was adapted from a tweet thread from @BrianFeroldiIn this episode, he will touch on such topics as:EBITDA is an accounting term that is an alternative way to measure a company's profitability.The accounting method is used to allocate the cost of a tangible asset over its useful life.Use debt to grow your business and lessen the payment of your taxes, by using the interest and depreciation expenses to minimize the tax bill.Lowering net income was a problem since it's an important number for investors and lenders, but you have to get them to understand to focus on cash flow instead of earnings.EBITDA is a quick way to roughly measure a company's cash flow. It ignores interest expense, so it allows companies with different capital structures to be compared.EBITDA fixes the problem of the taxes because it's calculated before interest expense, making comparisons fairer. It also enables comparisons between companies with different depreciation and amortization expenses.How to calculate your EBITDA as a practice owner. P.S. Subscribe, rate, and review HereAnd, if you like what you hear from the host, Dave Kittle, then it's possible that he and his team, The Fieldmaker Group, may be interested in acquiring some or all of your physical therapy practice.Connect with him on:Email: [email protected]: @davekittleLinkedIn: https://www.linkedin.com/in/davekittle/orCall (646)-781-8884 Hosted on Acast. See acast.com/privacy for more information.