By Sandra Norby, PT, DPT
“Plan your exit strategy before you open your doors.” “Sign the partnership exit agreement when you sign the partnership agreement document.” Great advice—and I wish we had paid more attention to that advice at both moments in our company’s history.
Succession planning is truly a vital part of the life of a company. It defines how your story will end and is very important no matter what size of business you own.
This year, we have personally experienced the positives and negatives of not having solidified these plans before we opened for business. When we opened HomeTown Physical Therapy, we started with a partnership model that would allow individual clinics to separate from the parent organization if such a need or desire arrived. Our first four locations were created this way, but by clinic five and six, we painfully realized that this model was not working well for two reasons. First, it had a tendency to create “silo” thought processes. Second, it created more work necessitating the need for different bank accounts, QuickBooks logins, and tax returns.
My husband and business partner, Kim, and I have devoted many hours over the past several years figuring out what our company should and needs to look like and what our legacy will be. Attending sessions at Annual Conference on this topic over the past two years assisted in our current “final product” that we feel matches what our intent of our business model was to be and will be in the future.
With the work of Paul Welk, PT, JD, and Randy Roesch, PT, MBA, we have a solid operating agreement and valuation that defines how and when our managers are able to buy shares in the company, under one tax ID, and when we will exit the company with the intent that our team will purchase the remaining shares upon our retirement.
So, my friends, my advice is to take the time now either to create a plan or review your current plan and take advantage of experts within our PPS family to assist you in one of the most important decisions your company needs from you. It has been an interesting journey for us, but in the end, the decisions made have all been falling into place for an exciting next 20-plus years for HomeTown Physical Therapy, LLC.