Partner roles and duties

RE: Partner roles and duties

Mark Hedberg — Wed, 13 Nov 2019 10:49:15 GMT

[quote user="Edward Jones"]

Not uncommon for a well-meaning retiring vet to sell non-corporate, just for the new owner to sell to a corporate within only a few years.

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Happened down the road from me - the senior partner retired and sold his shares to the other partners. Twelve months and maybe a week later they sold to one of the big three letter corporates.

I always thought that was unfair to the old partner, but business, i suppose, is business.

RE: Partner roles and duties

Anthony Todd — Tue, 12 Nov 2019 16:24:39 GMT

[quote user="Thomas Johnson"]And rota yourself time to do the 'management' jobs.[/quote]

Don't solicitors in big multi- practices have a "Managing Partner"?? Probably paid separately for doing it??

RE: Partner roles and duties

Thomas Johnson — Tue, 12 Nov 2019 16:09:41 GMT

[quote user="Iain Richards"]Yes, divide the roles, but also check who really wants to do the management. Too many vets feel they have to be managers, but are wholly unsuited to it. So you may have one who is good at it and two who are not, but need to be honest about it.[/quote]

And rota yourself time to do the 'management' jobs. You'll find that there are bits and pieces that you do every day in between clinical work, but you also need time set aside where that is your entire focus. If one or more of you are going to take on more of the management work then you can have more time set aside than those that aren't doing as much of it.

RE: Partner roles and duties

Bob Russell — Tue, 12 Nov 2019 13:06:41 GMT

If it is being sold at a discount in comparison to a corporate buyer then it is essential for some sort of clause to protect the original seller.

I have heard of several practices that were resold (possibly more than once) soon after purchase.

RE: Partner roles and duties

Jill Butterworth — Tue, 12 Nov 2019 12:41:40 GMT

[quote user="Edward Jones"]just for the new owner to sell to a corporate within only a few years[/quote]

Months!

RE: Partner roles and duties

Edward Jones — Tue, 12 Nov 2019 11:31:26 GMT

Speak to a specialist accountant, I'd suggest Hazlewoods. For financing I've found Shire helpful https://www.shirevet.co.uk/

I would suggest an uplift clause for the seller, but I suppose that's a matter for them rather than for you. If push comes to shove, and the seller comes to realise the difference that selling to a corporate might make, then you could suggest an uplift clause to share any increase in value. Not uncommon for a well-meaning retiring vet to sell non-corporate, just for the new owner to sell to a corporate within only a few years.

RE: Partner roles and duties

Iain Richards — Tue, 12 Nov 2019 10:42:14 GMT

One valuer (for both seller and buyer) - valuing without the massive multipliers the corporates offer and one solicitor if you can. You don't want to start the partnership with arguments.

Yes, divide the roles, but also check who really wants to do the management. Too many vets feel they have to be managers, but are wholly unsuited to it. So you may have one who is good at it and two who are not, but need to be honest about it.

Pay yourselves propely, with a pension, becuase you'll never, "make it up when we are succesful"

Delegate and nurture the staff. Get a good practice manager and pay them, certainly as much as a vet.

HOld practice meetings and partner meeting in working hours. Even if itmeans closing an evening surgery or two.

Join SPVS, especially the discussion list, speak to Anval if at the london vet show, or just ring them.

Enjoy the ride.

RE: Partner roles and duties

Bob Russell — Tue, 12 Nov 2019 09:38:22 GMT

Having had a practice manager that was a bully and a disaster I would not agree it is necessarily a good thing.

What you need is a boss that delegates!! I cannot be bothered with the day to day hassle of running a practice so I delegate it to people that are interested.

The accountants make me do things if necessary!!

RE: Partner roles and duties

Sarah Keir — Tue, 12 Nov 2019 07:52:04 GMT

Very noble of the current business owner to not want to sell to a corporate, but do you know how much the corporates are paying for practices currently? You may not even come close to raising that figure - it eventually boils down to £££ no matter what people outwardly say.

That may well be the list of responsibilities but it is missing the most important one - leadership of the business. The rest can and the majority should be delegated to those that have a better skill set than yourself. I second the practice manager thing - I will not accept an employed job in practice that does not have a practice manager. The 'boss/bosses' cannot do it all.

RE: Partner roles and duties

James Dunne — Tue, 12 Nov 2019 06:57:58 GMT

[quote user="An On MRCVS"]

I work in a practice that is owned by a sole-trader looking to hand over the reigns gradually. He is not keen on selling to a corporate. He has offered to explore, confidentially, with myself and a small number of other long-term employed vets becoming a partnership. I will doubtless seek, and pay for, some independent advice on behalf of myself should this conversation continue to specifics, but at this stage it is an early discussion and there is limited specifics to be discussed.

What I would value at this stage is knowing the basic nuts and bolts of this sort of thing. Hopefully the sort of thing that sage voices with experience of being in a partnership can advise on to some extent.

Firstly, what is the general advice on limited liability partnerships versus limited companies. My initial instinct is the former sounds better with the only disadvantage being that your personal income is in public domain (I don't think I'd care)? An accountant will answer this better.

There would need to be some sort of a valuation. What's the etiquette on this? All agree to a valuer and then stick with that? Three independent valuations and take the middle one? Current owner obtains one valuation and prospective partners obtain another and then meet half way in-between? There are many methods of valuation, it boils down to how much the existing partner is willing to sell for and what you are willing to buy for. Be aware that if you cannot agree there or thereabouts what the figure is, that the corporate option may become more attractive.

Can we all use the same solicitor (owner and prospective partners) to save on costs and time rather than having lots of different solicitors or is this too much of a conflict of interest for a solicitor to handle? [If all using the same solicitor I would probably still want to get some independent advice on what was agreed before signing…] Yes, you can and it does save time and money provided it is all amicable from the start.

Does anyone have a list of Partner roles that would need decided upon? I don't want to end up in a partnership where I do all the work, but I'm struggling to draw up an actual list of roles currently performed by the owner [who is wishing to phase out] that would need taken over.

Off the cuff, I can think of: staff management, health and safety, facilities management, stock control, payroll, procurement, bill payments, insurance/account-management, dealing with accountants, complaints, staff rotas, clinical governance. What am I missing? Budgeting and monitoring sales figures in relation to expense, marketing and advertising, compliance [RCVS, VDS, local council], CPD, pricing [is this updated regularly?] etc. If there is not already a practice manager in place, they are a good investment in a multi-vet practice. If that's out of the question, then attending CPD would be worthwhile or getting in outside help from business management experts like Vet Dynamics or Brian Faulkner is worthwhile.

Wages/profits! Stick to current vet salaries for prospective partners increasing with inflation only for 5 years, but with share of profits either split evenly, or based on current salary% split, or done by % of "management" duties undertaken? I really have no idea what is advisable here? I doubt that all the vets earn the same amount currently, but translating that to partner %'s sounds like a recipe or arguments before even started working together…This is where there is potential for the most arguments. You don't say what a 'small number' of other vets is and whether they are part-time or full-time. Beware if the pie is sliced enough it may not be viable to sell to multiple vets. Or whether these vets all wish to purchase equal share. My advice is agree upfront on a daily rate to include weekend/night work pro-rata and then divide profits according to percentage share purchased. That worked for us with a 4-person partnership where one parter was half-time, 3 full-time and the divide in share ownership was 1/3,1/3,1/6,1/6.

Thanks in advance to the collective wisdom on here.

Anon1 [in case other anons comment]:v The existing partner may allow purchase over a number of years rather than getting paid in a single lump-sum. This essentially starts the incoming partners on low rates which increase as their percentage ownership increases and the existing partner reduces down. The cleaner way is taking out loans and paying off the existing partner in one go, but it is considerably more painful financially!

Hope that is of some use!

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