06th Aug 2008
Doing “Due Diligence” to avoid buying a “Pig in a Poke”
The term “pig in a poke” comes from the old days, when someone would buy from someone else, and not see what he or she was getting. The item being bought was not shown to the buyer before the money was paid. Would you buy a pig in a poke?
I wouldn’t. I would want to see what I’m getting before I shell out my hard-earned money. But too many young chiropractors do just that. They buy a practice, or they sign up with a practice management company, or they become an associate before getting all the facts. Due diligence is the process of getting all the facts. It is a complete 360 degree analysis of a business opportunity, with disclosure of all material (important) facts.
For example, if you were doing due diligence on a practice purchase, you would want to know if there were any outstanding debts that the practice had not paid. There are lots of other items to check in a practice purchase. A comprehensive list is included in my e-book Buying a Practice (scroll down the page to find this booklet).
If you’re looking at a practice management company, check them out at the Better Business Bureau or Ripoff.com, or go to the office of the Attorney General in your state and see if the company has complaints against it.
In any case, doing your due diligence can mean the difference between a bad transaction and one that works out well. Get what you’re paying for - do your due diligence.
The term “pig in a poke” comes from the old days, when someone would buy from someone else, and not see what he or she was getting. The item being bought was not shown to the buyer before the money was paid. Would you buy a pig in a poke?
I wouldn’t. I would want to see what I’m getting before I shell out my hard-earned money. But too many young chiropractors do just that. They buy a practice, or they sign up with a practice management company, or they become an associate before getting all the facts. Due diligence is the process of getting all the facts. It is a complete 360 degree analysis of a business opportunity, with disclosure of all material (important) facts.
For example, if you were doing due diligence on a practice purchase, you would want to know if there were any outstanding debts that the practice had not paid. There are lots of other items to check in a practice purchase. A comprehensive list is included in my e-book Buying a Practice (scroll down the page to find this booklet).
If you’re looking at a practice management company, check them out at the Better Business Bureau or Ripoff.com, or go to the office of the Attorney General in your state and see if the company has complaints against it.
In any case, doing your due diligence can mean the difference between a bad transaction and one that works out well. Get what you’re paying for - do your due diligence.
Posted in Practice Management companies, Buying a Practice, getting ready to practice, associate and independent contractor issues, startup experiences | No Comments »
