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Buying a pharmacy | Funding your first pharmacy purchase

12 February 2020

How To Fund Your First Pharmacy Purchase

So, you have found the perfect pharmacy to purchase to start your career as an owner pharmacist. You have all sorts of plans as to how to grow the business and all the changes you want to make.

But how do you fund the goodwill purchase price plus the stock, plus refit, legal, bank and advisor fees?

You do need some money upfront as a deposit to start the process and make sure you can afford everything.

In addition to the goodwill purchase price you will need to think about the following;

The transaction itself

Legal fees | These could be £10,000 plus depending upon the complexity of the transaction.

Bank fees | These could be £5,000 plus to set up any loan but sometimes this can be wrapped up into the overall loan. Not always so check.

Accountancy fees | Do you need an accountant from day 1? Probably before day 1 to make sure that you have a full understanding of any accounts of the target pharmacy and your bank loan proposals.

Stock | This could be anything from £30,000 to £60,000 plus depending upon the turnover of the pharmacy. How are you going to fund this?

Immediately after acquisition

Cashflow | How much extra cash do your cash flow forecasts indicate you will need during the first few months?

Refit | How much cash do you need to fund refit costs or even just changing the fascia sign?

Relaunch | Do you plan any local marketing to relaunch the pharmacy under your new ownership?

The funding itself

Bank debt | Check with your bank whether they are comfortable supporting an acquisition and at what scale?

Other funding | Do you need other sources of financing such as factoring?

Combining funding | Can you wrap additional funding needs, such as professional fees, refit costs and cashflow up in the bank loan? If not how will you fund them?

How much deposit do you need?

Probably at least 20% of the goodwill price and most likely more if the pharmacy is not very profitable at the point of acquisition before you implement your business plan.

How do you find a bank/ funder?

Ask your friends and colleagues who have already taken the plunge into ownership for their experiences and crucially engage an expert financial advisor who can assist in formulating your request for funding to a bank.

PS Finance is a sister company of Pharmacy Seekers and can not only access a range of more than twenty funders and banks that are keen on lending to community pharmacy but also help you with cash flow calculations and financial forecasts.

Only when your funding is guaranteed can you then sign the legal paperwork to purchase the pharmacy and make your ownership dreams a reality.

For an informal chat contact PS Finance about your funding requirements. Contact Brian at PS Finance on 01923 825 007 or email brianp@ps-finance.co.uk

Pharmacy Seekers – Experienced pharmacy professionals to support your pharmacy purchase

To help you succeed at each step of the road map our team at Pharmacy Seekers have unparalleled experience over decades, working in operational, financial, developmental and leadership roles within the pharmacy profession.

• We provide a supported purchasing process

• We provide end to end support – from decision to purchase to completion

• You will receive director level contact and assistance throughout

• We are the pharmacy specialists and don’t get distracted with work in other sectors

• We can help you prepare your business plan and financial application for funding

• We have an extensive associate network to assist with developing your pharmacy


If you need some informal advice now about buying a pharmacy contact steve@pharmacyseekers.com or chris@pharmacyseekers.com