For many GPs, practice ownership offers greater control over clinical culture, patient care and long-term financial outcomes. However, there is no single route into ownership. The right structure will depend on your appetite for risk, access to capital, preferred level of autonomy and willingness to manage people, systems and compliance.
Broadly, there are five ways to become an owner: establish a practice independently, establish one with partners, buy into an existing practice, acquire an existing practice on your own or acquire an existing practice outright with others. Each option brings a different balance of freedom, support, complexity and risk.
Setting up a practice on your own
Starting from scratch gives you the greatest freedom to shape your practice location, service model, team, technology and patient experience. You are not inheriting another owner’s systems or culture, and the value you create belongs to you. The trade-off is that you carry the full establishment workload and financial exposure.
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Key considerations
- Have you tested local demand before signing a lease or buying a property?
- Do you understand the capital and financial commitments?
- How will you fund them?
- Who will manage the operations of the practice?
- What structure will you use to own the practice?
Key recommendations
- Test the local demographics and competition. Also check referral patterns and patient demand.
- Allow for premises and fit-out. Allow for equipment and technology. Cover recruitment and marketing, and keep working capital in place while the patient base grows.
- Decide whether to invest existing funds or seek finance from external parties.
- Plan who will manage billing and payroll as well as rostering and accreditation. Also decide who looks after privacy and workforce obligations, and who deals with suppliers.
- Obtain advice on the ownership entity, covering asset protection and tax.
Setting up a practice with others
Establishing a new practice with other GPs can spread capital requirements and management responsibilities. Partners may also bring complementary skills, referral networks and clinical interests. The main challenge is ensuring that everyone’s objectives and expectations are aligned before money is committed.
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Key considerations
- Who will take on operational and strategic roles?
- How will income and capital be shared?
- How will each owner be paid for working ‘on’ the business?
- How will the owners work with each other?
- How will owners leave?
Key recommendations
- Document who has authority over clinical and staffing decisions as well as financial and strategic ones.
- Discuss working hours and leave, growth ambitions and outside work. Also talk through tolerance for debt and what happens if an owner is unexpectedly absent.
- Document a succession and exit plan in the owners’ agreement. Cover how the practice is valued and transferred. Include provisions for incapacity and disputes, and for restraints.
Buying into an existing practice with other existing owners
Buying an interest in an established practice may provide immediate access to patients, staff, premises and operating systems. Existing owners can offer continuity and practical knowledge, making this a less isolated transition. However, you are buying both an asset and an ongoing relationship, so cultural fit can matter as much as the financial results.
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Key considerations
- Do you understand what you are purchasing (i.e. shares, units or partnership interest)?
- Is the buy-in price fair?
- What return will you receive?
- How are decisions made in the practice?
- What commitments will you be taking on?
Key recommendations
- Confirm whether you are buying shares or units, or a partnership interest.
- Review several years of accounts and practitioner billings. Check normalised earnings and liabilities, as well as capital expenditure and owner-related transactions. Consider external due diligence advice.
Buying an existing practice on your own
Purchasing an entire established practice can offer immediate scale and full control without the delay of building everything from the ground up. It may include an established patient base, experienced staff, fitted premises and recognised goodwill. In return, the purchase price and due-diligence burden are usually greater, and you alone are responsible for the transition.
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Key considerations
- Do you understand what you are purchasing (i.e shares and units or goodwill and business assets)?
- How much is tied personally to the outgoing owner?
- Will the outgoing owner support the transition?
- Have you checked what you are paying for?
- Could your cash flow handle unexpected costs?
Key recommendations
- Confirm whether you are buying shares or units, or the goodwill and business assets.
- Assess how much revenue is tied to the outgoing owner. Do the same for goodwill and patient loyalty.
- Agree on introductions and handover support. Settle communications and appropriate restraints too.
- Inspect the equipment and software, and the cybersecurity and compliance systems. Check the premises too for upgrades needed soon after completion.
- Plan for slower billings or staff changes, and for unexpected costs.
Buying an existing practice with others
Purchasing an entire established practice with others provides the opportunity to share the investment with others who may have a complementary skill set to your own.
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Key considerations
- What structure will own the practice?
- How will the owners fund the purchase?
- How much will each owner contribute to working capital?
- How will the owners make decisions?
- How will profits be shared?
Key recommendations
- Agree on how the practice will be structured with consideration to future owners and succession planning.
- Agree on a profit sharing agreement with consideration given to both bringing income into the practice as well as being remunerated appropriately for management tasks taken on by owners.
- Document a policy on how cash distributions to owners are calculated.
- Consider options in respect of financing the practice acquisition and the working capital.
Choosing the right pathway
Before selecting an option, compare the pathways against a consistent set of criteria: the capital you can invest, your borrowing capacity, the income variability you can tolerate, your preferred level of control, the management time you can contribute and the people you want to work with. Also consider whether you are motivated by building something new or improving an established business.
Whichever route you choose, a disciplined process is essential and seeking legal, tax, finance and commercial advice is important to protect your investment. Practice ownership can be professionally and financially rewarding, but the strongest foundations are built before the doors open, or before the purchase contract is signed.
Whether you’re setting up, buying in or buying out, speak with your William Buck advisor about the right structure for you and how to protect your investment.
