Market Valuation FAQ
Market Valuation Frequently Asked Questions
Is there a standard formula I can use to determine the value of my pharmacy?
No, pharmacy values vary widely with respect to prescription volume, sales, and net profit.
I always hear about pharmacy values based upon dollars per prescription. What is the average price per Rx?
First and foremost, the dollars per Rx valuation metric is over used in the community pharmacy industry. Many times this metric can work to the advantage of the buyer, so proceed with extreme caution when discussing valuations using this metric with a potential buyer.
How important is location when determining value?
Location is not as important as the number of potential buyers, but the two often times go hand in hand. If the pharmacy is located in a major metropolitan area, the number of buyers is often times larger.
Will the staffing of the pharmacy affect the value?
Often times yes, if the owner of the pharmacy is also the primary pharmacist, with little or no other R.Ph. staffing, then the number of potential buyers may be limited. Remember that other factors, including prescription file sale or going concern sale, operational factors, and potential buyers also play an important role in the overall value of the pharmacy.
Should I have a market valuation done by someone lacking expertise in community pharmacy transactions?
No, at PCA we only do valuations on pharmacies. Our experience and daily involvement in the transfer of ownership and valuations positions us perfectly to provide you with accurate fair market values.
I came across a broker offering free valuations, why should I pay for this service?
PCA is a community pharmacy consulting firm, and when you engage us on a project we are providing you with unbiased opinion. Having valuations performed by brokers attempting to get a listing, by offering you a free valuation, may open the process up to conflict of interest.