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Northwest Iowa Vet Practice – Only a 2 Multiple



  • Price

  • Revenue

  • Equipment

  • Location
    Northwest Iowa

  • Reason for Sale
    Declining health

  • Lease

  • Intangible Assets
    Name recognition, website, trusted community member

  • Employees
    2 Vet Techs, 1 Office Assistant

  • Profit Margin

This small animal vet practice in NW Iowa has been serving the community for over 55 years!  With low overheard, the office is leased at only $1500/ a month. Specializing in cats and dogs, nearby horses and some small farm animals also come to this owner/operator clinic. The owner is selling due to failing health and would be willing to offer compelling negotiations to the right buyer.


Included in the purchase of the clinic is roughly $132,000 in assets. A new owner would receive $84,000 in general DVM equipment, the majority of it purchased within the last 3 years. Nearly $15,000 in wholesale inventory will transition to a buyer, as well as around $14,000 in A/R, with 70% of it collectible.


Growth exists in adding grooming services for the current clients, as well as some boarding. The current owner previously worked with large farm animals, but due to health issues has discontinued that practice in recent years. This would be a great area for growth, as the practice is situated in farm country.  This business would be perfect for a larger company looking to expand territory or a young vet looking to a grow a great business!

Business Highlights

  • Year Established: 1961
  • Location: Northwest Iowa – serving a 25-min radius
  • Services: Check-ups and urgent care for dogs, cats, horse and some small farm animals
  • Lease: $1,500/month
  • Reason for Selling: Declining health
  • Employees: 2 Vet Techs, 1 Office Assistant
  • Hours: Mon – Thurs 8am to 5:30pm, Fri 8am – 5pm, Sat 8am – 12pm
  • Seller Training Period: 1 year working 20 hrs./wk.
  • Growth Opportunities: Add grooming and more vets; current owner has not worked with large animals in recent years, but a new owner could add this service back
  • Current Owner’s Responsibilities: DVM

Financial Highlights

  • List Price: $232,000
  • Gross Sales:
    • 2018: $428,408
    • 2017: $417,410*
    • 2016: $451,893
    • 2015: $393,689
    • 2014: $358,220

*The owner has been ill and was out of the clinic for several months in 2017, leading to the decline in sales and cash flow. 

  • Cash Flow:
    • 2018: $116,701
    • 2017: $105,451
    • 2016: $143,148
    • 2015: $114,031
    • 2014: $100,875
  • Assets Included in Purchase*
    • Equipment: $117,000 – autoclave, blood analyzer scanner, digital navigator, therapeutic laser, anesthesia machinery, x-ray 
    • Inventory: $15,000 in wholesale value
    • Intangible Assets: Name recognition, website, trusted community member

*amounts may vary

Cash Flow Analysis

Description of Financial StatementP&L StatementTax ReturnTax ReturnTax ReturnTax ReturnNotes
GROSS SALES$428,408$417,410$451,893$393,689$358,220
Net Income Shown on Financial Statement$67,080$65,615$102,199$72,073$65,225
Compensation to Owner$10,457$12,000$12,000$12,000$12,000
11% Tax on total W2 Salaries$1,150$1,320$1,320$1,320$1,320
Interest$0$896$1,484$2,298$1,990Non-onward going expense
Rent$23,470$25,620$26,145$26,340$20,340Onward rent of $1500/month
Health Insurance$13,415$0$0$0$0Personal expense
Auto Expense$5$0$0$0$0Personal expense
Contributions/Donations$1,124$0$0$0$0Non-onward going expense
TOTAL ADDBACKS$49,621$39,836$40,949$41,958$35,650
Seller's Cash Flow = Total Addbacks + Net Income$116,701$105,451$143,148$114,031$100,875
Profit Margin27.24 %25.26 %31.68 %28.96 %28.16 %
  • 27% profit margin in 2018!


  • 2 Veterinary Technicians
    • One has 8 years of service with the clinic
    • One has 3 years of service with the clinic
  • 1 Office Assistant
    • Has been with the clinic for 1 year


All equipment included in the sale has been purchased within the last 3 years, with the exception of the x-ray machine.

  • Autoclave - $6,000
  • Small animal dental unit - $1,600
  • X-ray - $9,000
  • Power dental float – horses - $4,500
  • 2 microscopes - $1,200
  • RK Incinerator model EHA - $4,000
  • Analyzing equipment - $60,000
    • Replaced blood analyzer and Abaxis vetscan
    • Also does urinalysis
    • Incorporates info into Cornerstone software
    • Monthly fee paid, but credit is given back for usage
  • CR4000 digital navigator-3058 - $21,000
  • Gas anesthesia machine - $2,000
  • Therapeutic laser - $2,300
  • Vital signs anesthesia monitor - $2,500
  • Miscellaneous medical equipment - $3,800

Industry Outlook

  • Number of veterinarians employed in Iowa – 1,500+
  • Hourly mean wages of around $37
    • Annual mean wage of $78,040
  • Veterinarians in Iowa earn more than 94% than other animal-related careers in Iowa
  • Iowa veterinarian salaries are in the top 93% of all careers in Iowa

Valuation Details

The Firm Business Brokerage used a cash flow valuation methodology to determine the purchase price of the business. 

The formula used is as follows:

Cash Flow       x          Prescribed Multiple     =          Fair Market Value

Cash flow is the sum of business net income plus any owner perks and any non-onward going expenses.

A multiple is prescribed by a 20 question, 100-point parameter ranking system that is used to analyze the current business health. Each question is based on a scale from 1 to 5: 1 being low, 2 below average, 3 average, 4 above average, 5 high. The average of the responses sum is the business’ prescribed multiple.

For this business, a 2018 cash flow was used with a prescribed multiple is 2.  With this information, the computation is as follows:

$116,701         x          2          =          $233,402

The fair market value found above positions the business list price at $232,000.

Funding Example


Purchase Price:                       $232,000

100% Bank Loan:                    $232,000

Bank Loan with a 10-year term at a rate of 6% equals a monthly loan payment of $2,576.

Please note that the decision of whether to extend a loan on any sale belongs to the bank, and this document does not guarantee specific terms or verify that financing is available. 



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210 N 78th St. 2nd Floor
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