Buying a small senior care operation can get competitive. We find that ALFs, home care agencies, home health agencies, and adult daycare centers that enjoy strong reputations in the community get premium prices when sold. They have loyal client bases and trusted employees. They demonstrate solid revenue growth and continued profitability. And buyers recognize this. Buyers, unfortunately, do not recognize the things that may make them instantly undesirable or disqualified. We list 10 things below that hurt buyers in attracting sellers of senior care operations:
Buyer only has "sweat equity" and expects the bank and the seller to provide primary financing.
Buyer wants to be an absentee owner. Expects to hire a manager to run the operation.
Buyer is secretive about the source of money or amount available to invest in the operation.
Primary source of funding comes from non-banking, outside sources (e.g., an investor).
Buyer has declared bankruptcy within the last 7 years.
Buyer asks lots of questions and is uncertain or unclear on the reasons for buying the operation.
Buyer appears to be a competitor or tire-kicker seeking inside information
Buyer wants seller to remain as an employee
Buyer's personality clashes with the seller's personality
Buyer's management style is not a good fit with the existing operation's work culture.
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