As we have stated on this site, buying your pharmacy is not something you want to try to do on your own. You need financial support to ensure that your bottom-line issues are addressed, and legal support to ensure that your long-term interests are protected. Beyond that, you may need the support of people who have been through the process and know it well. That’s where RxOwnership can be an important asset.
For example, our Ownership Advisors are available to address your questions and concerns from the planning stage to long after you open the doors of your pharmacy. And because your conversations with our Ownership Advisor are kept in absolute confidence, you can start that planning well in advance of your eventual purchase.
For other important sources of information and support, click here.
Once you are ready to become an owner, our Buyer Services offerings can assist you in finding available pharmacies that meet your specific requirements.
Confidential information at every stage of the pharmacy ownership process. We can even supply you with an NDA (Non-Disclosure Agreement) for your protection.
Want to talk to an experienced professional who truly understands the issues involved in selling or buying a pharmacy?
Our Ownership Advisors can answer your specific questions in complete confidentiality.
Putting our money where our minds are
McKesson can help you identify and evaluate the vast financing options available to you as you prepare to buy a pharmacy. We have an active portfolio of loans for buyers, and a long tradition of providing financing support to independent retail pharmacies. McKesson area credit managers work with more than 800 independent pharmacies and can share their expertise with you on financing and credit issues.
Through RxOwnership, McKesson has over $40 million or more in debt loans in place with customers. We evaluate dozens of loan requests annually, reviewing them against industry-standard requirements. Using these time-tested standards protects both the customer and McKesson.
Below are the basic requirements for long-term financing, defined as one year or longer, from McKesson:
- Equity contribution in the range of 20–25%: As the buyer, you must provide a down payment from your own resources. It is important that you have “skin in the game” and be willing to place your resources at risk just as our resources are at risk.
- Collateral coverage of 1:1: For every dollar loaned, there must be a dollar of tangible goods that could be sold to pay off the debt. This collateral takes the form of inventory and accounts receivable. McKesson will also grant some value to the Rx files.
- First secured position filed under the Uniform Commercial Code (UCC): In the case of bankruptcy, McKesson must be the first creditor to be paid off.
- Maximum of seven-year term: The typical term of financing from McKesson is three to seven years, with a maximum of seven years. Loans with a longer term than seven years indicate that the pharmacy is overextended or unprofitable.
- Interest rate: McKesson offers competitive interest rates to those who qualify.
- Complete financial documentation: A full understanding of the financial health of the pharmacy — and how it has performed operationally in the recent past — is critical to financing. In many cases, the McKesson area credit manager will have some of this information available for existing customers. McKesson must review two years of financial statements and interim statements to evaluate the loan. Financial statements should include:
- Income statement
- Balance sheet
- Cash flow statement
- Projections and/or a business plan, including background information on the principals
- Personal financial statement
- Personal guaranty from the buyer: The buyer must personally guarantee the loan from McKesson by completing McKesson’s form of personal guaranty.
- Valuation of the business: The loan amount is tied to the worth of the pharmacy. There are multiple methods for determining pharmacy valuation, as noted above. McKesson Credit uses a combination of valuation methods as appropriate for each specific deal.