Selling your plastic surgery practice is one of the most important financial decisions of your career. It is a major milestone. For practice owners in St. Louis, the current market presents a unique window of opportunity, but capitalizing on it requires more than just a “For Sale” sign. A successful sale that protects your legacy and maximizes your financial outcome is a process, not an event. It demands thoughtful preparation and strategic execution.
St. Louis Market Overview
The St. Louis market for plastic surgery is robust. A strong local economy and consistent demand for high-end cosmetic and reconstructive procedures make established practices highly attractive. We see significant interest not just from local health systems, but from regional and national private equity groups looking to enter or expand their footprint in the Midwest.
This buyer appetite is good news for a potential seller. It creates a competitive environment that can lead to premium valuations. However, these sophisticated buyers are also discerning. They look for well-run practices with clean financials, stable staff, and a strong reputation in the community. Your ability to present your practice professionally is as important as the market’s strength.
Key Considerations Before You Sell
Before you dive into the market, the most important work happens internally. A smooth transaction starts with clarity on your own goals and circumstances.
Personal and Financial Readiness
A sale impacts your life, not just your bank account. Are you emotionally ready to transition from owner to employee, or to retire completely? Is your family supportive of this change? Answering these questions honestly is the first step. Thinking about what you will do with your time and energy after the sale is just as important as the financial planning.
Aligning Partner Goals
If you have partners, alignment is everything. One partner may want to cash out and leave, while another may want to stay and work for years. These different goals must be reconciled early. Misalignment between owners on timing, valuation expectations, or post-sale roles can stop a great deal in its tracks.
Assembling Your Expert Team
You cannot do this alone. A successful sale requires a team of experienced professionals. This includes legal counsel familiar with healthcare transactions, a CPA for tax structuring, and an M&A advisor to manage the entire process. Building this team early ensures you are prepared for due diligence and can negotiate from a position of strength.
Understanding Market Activity in St. Louis
The interest in St. Louis plastic surgery practices comes from several types of buyers, each with different motivations. Understanding who they are helps you position your practice effectively.
- Private Equity-Backed Platforms. These groups are often the most aggressive buyers. They seek to build a regional or national brand. They value strong profitability, efficient operations, and a lead surgeon willing to stay on for a period post-sale to ensure a smooth transition.
- Local and Regional Health Systems. Hospitals may look to acquire a strong plastic surgery practice to round out their service lines, particularly in areas like breast reconstruction or cosmetic surgery. They are often focused on community reputation and referral networks.
- Large, Expanding Practices. Sometimes your buyer is a successful peer. A larger practice in the region may be looking to expand its geographic reach or add a talented surgeon. These deals can be simpler but may offer less access to the growth capital a PE firm provides.
The Four Phases of a Practice Sale
A typical practice sale takes 6 to 12 months from start to finish. The process is not a quick transaction but a structured journey. We break it down into four main phases. Proper preparation in the early stages is the best way to prevent surprises and delays later on, particularly during due diligence, where many deals face their biggest tests.
| Phase | Typical Duration | Key Activity |
|---|---|---|
| 1. Preparation & Valuation | 1-3 Months | Organizing financials, normalizing earnings, and securing a formal, market-based valuation. |
| 2. Confidential Marketing | 2-4 Months | Identifying and discreetly approaching a curated list of qualified buyers. |
| 3. Negotiation & Due Diligence | 2-4 Months | Structuring the letter of intent (LOI), and managing the buyer’s deep review of your finances and operations. |
| 4. Closing & Transition | 1-2 Months | Finalizing legal contracts, announcing the sale, and beginning the post-close integration plan. |
What Is Your Practice Really Worth?
Valuation is more art than science. While formulas are involved, the true worth of your practice is determined by its sustainable cash flow and future potential in the eyes of a buyer. At SovDoc, we take a private equity-grade approach to this process.
It Starts with Adjusted EBITDA
The key metric is not your net income. It is Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization). We start with your stated profit and then “normalize” it by adding back expenses that a new owner would not incur. This includes things like your personal auto lease, above-market owner salary, or one-time capital purchases. This simple step alone can often increase a practice’s perceived earnings significantly.
Finding the Right Multiple
Once we have a stable Adjusted EBITDA, we apply a valuation multiple to it. This is not a fixed number. It changes based on several factors:
* Scale: Practices with higher EBITDA command higher multiples.
* Provider Mix: A practice less dependent on a single owner is less risky and more valuable.
* Revenue Mix: A healthy balance of surgical, non-surgical, and ancillary cash-pay services is attractive.
* Growth: A track record of steady growth will always earn a premium.
Relying on a generic “rule of thumb” for plastic surgery practices is a common mistake that leaves money on the table. A true valuation requires deep analysis of market data and your practice’s unique story.
Planning for Life After the Sale
The work is not over once the deal closes. A successful transition is critical for the buyer, your staff, and your own peace of mind. Planning for this phase should begin long before the final contracts are signed.
Your legacy is tied to the continued success of the practice you built. A key part of that is ensuring your team is taken care of. Discussing staff retention and future roles for key employees during negotiations is a hallmark of a well-managed sale.
Most importantly, you need a plan for yourself.
* Define Your Future Role. Will you continue working full-time for a set period, move to part-time, or exit immediately? This is a key point of negotiation and should align with your personal goals.
* Protect Your Team. A buyer’s plan for your staff is a critical question to ask. Ensuring continuity for your team protects your legacy and makes for a smoother transition.
* Manage Your Proceeds. The sale will likely be the largest liquidity event of your life. Working with financial planners to structure the proceeds for tax efficiency and long-term security is vital.
Thinking through these elements ensures that when you sell your practice, you are stepping into a future you have designed.
Frequently Asked Questions
What makes the St. Louis market attractive for selling a plastic surgery practice?
The St. Louis market for plastic surgery is robust due to a strong local economy and consistent demand for high-end cosmetic and reconstructive procedures. Established practices attract interest from local health systems and regional and national private equity groups, creating a competitive environment for premium valuations.
What personal and financial readiness considerations should be made before selling a practice?
Before selling, consider your emotional readiness to transition from owner to employee or retire. It is important to have family support and clear plans for your time and energy post-sale. Financially, ensure you understand the impact of the sale on your life and plan accordingly.
Who are the typical buyers for plastic surgery practices in St. Louis?
Typical buyers include private equity-backed platforms focused on regional or national branding, local and regional health systems looking to enhance their service lines, and larger expanding practices seeking geographic growth or talent acquisition.
What are the key phases of selling a plastic surgery practice and how long does the process usually take?
The sale process usually takes 6 to 12 months and includes four phases:
- Preparation & Valuation (1-3 months): Organizing financials and securing a valuation.
- Confidential Marketing (2-4 months): Approaching qualified buyers discreetly.
- Negotiation & Due Diligence (2-4 months): Letter of intent and buyer reviews.
- Closing & Transition (1-2 months): Finalizing contracts and starting integration.
How is the value of a plastic surgery practice determined?
Value is primarily based on Adjusted EBITDA, which normalizes earnings by adding back non-recurring or owner-specific expenses. A valuation multiple is then applied, influenced by factors such as practice scale, provider mix, revenue mix, and growth potential. A detailed, market-based analysis is necessary for an accurate valuation.
