Common Mistakes When Selling a Med Spa and How to Avoid Them

The owners who win when it comes time to sell their practice prepare early, present a clear story, and keep control of the details that protect value all the way to the wire. Below are the pitfalls that trip up owners when selling their medical spa, and the practical fixes that prevent them.

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1) Negotiating with One Buyer‍

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Many owners start with the buyer who’s already calling. It feels easy until you realize you’ve traded leverage for convenience. Without competitive tension, valuation drifts down, structures skew buyer-friendly, and timelines expand.

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The fix: Run a targeted sales process with a curated set of MSOs and private equity groups that align with your size, service mix, and growth profile. You’ll create real choice on valuation, on terms, and on the partner you ultimately join. This puts you in the driver’s seat of your own exit. 

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2) Messy Accounting

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In any practice sale, messy books invite adjustments to the deal. Buyers will be conducting a financial audit of your business, and having your books tell a clear story will allow you to eliminate retrade conversations. 

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The fix: First, get a valuation from a medical spa broker that normalizes EBITDA and documents add-backs in plain English. At TUSK, we provide this complimentary, so you have a defendable baseline before buyers ever see your numbers. From there, keep monthly closes consistent and segment revenue so trends are obvious and credible.

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3) Compliance Gaps

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Med spas operate at the intersection of corporate practice of medicine rules, supervision requirements, HIPAA, and strict advertising standards. “We’ll clean it up later” will only result in a speed bump.

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The fix: Confirm your MSO/clinical entity alignment, management fees, and physician ownership with healthcare counsel. Refresh collaborative agreements and supervision logs. None of this is glamorous, but it keeps diligence straightforward and protects value.

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4) Overlooking Working Capital and Deferred Revenue

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Great price, disappointing wire. This happens when the working capital or deferred revenue treatment is handled casually. The buyer expects the business to come with a normal amount of short-term working capital on Day 1.

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Typically, the buyer and seller agree on a target amount called the peg. The peg is usually the average working capital over the last 12 months, adjusted for seasonality. Your actual working capital at close is measured against it.

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Many med spas collect cash before providing all the services. The unperformed portion is a liability called deferred revenue, because the buyer will need to deliver those future services after closing without collecting new cash for them.

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Buyers want a clean schedule that shows:

• Each package or membership sold, how much has been used, and how much remains
• Gift card balances, with a policy for breakage that matches history and state rules

‍The fix: Working with your M&A advisor, benchmark a fair peg using a 12-month average and map all liabilities for unredeemed packages, memberships, and gift cards with historical redemption. The clarity now will avoid a painful true-up later.

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5) Underestimating People and Culture

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Revenue walks on two legs. Surprises around non-solicits, compensation plans, or post-close expectations can spook a buyer or trigger a wave of departures after close.

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The fix: Refresh provider agreements, align post-close comp plans, and identify key staff who should receive stay incentives. Just as important, script how and when you’ll communicate the transaction internally.

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6) Selling Before You’re Ready

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If you launch prematurely, you’ll spend diligence reacting instead of negotiating. At TUSK, we prepare our clients to sell when the market can meet their financial needs, and the practice is well-positioned to maximize results.

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To recap, how should you prepare when selling your medical spa: 

• Get a complimentary valuation from a medical spa broker to understand the true value of your medical spa
• Conduct a light legal/compliance review
• Clean monthly closes and current deferred-revenue schedules
• Update provider contracts and a simple internal communications plan

With those pieces in place, you can move fast and keep medical spa buyers focused. Get started today with TUSK’s complimentary practice valuation here: https://info.tuskpracticesales.com/medspa-valuation

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