Chiropractic practices are typically valued using two methods: a percentage of annual gross collections, ranging from 50% to 80%, or an EBITDA multiple, ranging from 3x to 5x for independent buyer transactions.
EBITDA stands for earnings before interest, taxes, depreciation, and amortization. It is the most commonly used valuation metric for healthcare practice acquisitions because it measures the operating cash flow the practice generates before financing and tax decisions, which vary by buyer.
Multi-doctor veterinary practices face tax planning complexity that solo practices do not. When more than one veterinarian owns and operates the practice, decisions about entity structure, compensation allocation, retirement plan design, and profit distribution have different implications for each owner.