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Pharmacy Finance
Traditional and Alternative
Sources of Funding

 

Whether you are looking to purchase a pharmacy, or finance an existing location Washburn & Associates can assist you obtain the financing you need. We are direct correspondents to major financial institutions, fund managers, and investors.

Types of Pharmacy Finance

There are a number of methods to finance an existing pharmacy, or a pharmacy acquisition. Each can be customized, or included with other forms of financing to provide the pharmacy owner, or pharmacy buyer, with the best financing package and the greatest chance for the pharmacy’s financial success.

SBA Loans are offered by many lenders for financing an acquisition and these loans are a major source of funding a pharmacy business acquisition.

Non SBA Loans are offered by both banks and private finance companies.

Conventional Real Estate Loans are offered by both banks and private finance companies.

Bridge Loans for pharmacies will usually only be available from private finance companies.

Private Finance, or more commonly called Business Notes, can assist the purchase when the seller is willing to carry some of the financing and risk themselves.

Cash Flow Financing, also known as Accounts Receivable Finance, A/R Finance, or Factoring, is used to sell the pharmacies receivables in order to obtain the funds faster allowing the pharmacy to take vendor discounts, save interest expenses, etc.

Equipment Leasing, to obtain equipment, computers, furniture and fixtures. Equipment Sale Leaseback is a version where equipment owned free and clear by the pharmacy owner can be sold to a leasing company and then leased back.

Vendor Finance, is commonly used when a larger financially stable vendor wants to ensure they keep the company as a customer. The vendor understands the industry and will have a comfort level with the company’s past inventory turns.

Franchise Financing, can be offered by a pharmacy franchiser.

Purchase Order Finance, can be obtained when a finance company bases their financing decision on the strength of the company’s contract with a customer.

Personal Loans, from company directors, family, or friends maybe needed to offset some of the lenders risk. It is not unusual for a business buyer to use home equity, family jewelry, cash value of life insurance, or other assets to help collateralize a personal loan.

Senior Debts, which are loans that may or may not be SBA guaranteed, will be in first position in the event of default.

Subordinated Debts, are loans that will be in a position behind the Senior Debt.

Merchant Account Advances, where a pharmacy or drug store can use future credit card transactions to easily access cash.

To learn more about financing a pharmacy contact Washburn and Associates.
  

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