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Our transition planning consultants have experience with small, medium or large healthcare facilities. Working with you to accurately plan a relocation to a new facility, merger or buyout. Being well prepared and falling within budget is two of the focal points of our service.
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The Medical Equipment Resources & Consulting Team would like to wish everyone a Merry Christmas and a Happy New Year!
May you have a wonderful holiday season and we look forward to working with you again soon!
Medical Equipment Resources & Consulting would like to wish everyone a Happy Thanksgiving!
It is a great time to spend with friends and family and reflect on the things we are thankful for. At MERC, we are thankful for the customers we have had the opportunity to serve, the future ones, and are looking forward to the remainder of the year’s opportunities to bring value to the healthcare marketplace.
Have a wonderful and safe holiday!
Often times liquidating medical equipment and other assets can be a complex and confusing process.Much of the value that is received for the item depends on what kind of transaction is taking place.There are definite differences between these variables and must be understood to fully get a grasp on what it means to liquidate assets.Hopefully the brief explanation below can help your organization better understand the liquidation marketplace.
Fair Market Value (FMV) is the market value of an asset based on a transaction between two willing and unpressured parties.This doesn’t factor in needing to sell an item on a deadline or the factors that often include a medical equipment sale like de-installation and re-installation.This value is best utilized on a peer-to-peer sale when the seller is selling the item(s) to a buyer who will keep them in their current location.This would most likely be the case when a hospital system or healthcare management firm purchases the assets of a particular doctor or center that will keep them in use at their current location.A value based upon this type of transactions will reflect higher values because the items are bought where they are being used and taken care of.
On the other hand, Orderly Liquidation Value (OLV) is when assets are being sold outside of the peer-to-peer relationship and instead sold in a specific time period.This is most common when an asset is sold to a refurbisher or medical equipment buyer on the secondary market.OLV then factors the costs involved in the possible de-installation of the items (if necessary), certifying, refurbishing, warehousing, and marketing costs for re-sale.When all of these potential costs are factored in, the seller has to realize the value will be a reflection of these costs and likely be less than an FMV.These sales are typical when a facility has no more use of the asset (due to new technology purchase, etc.) and when items come back from leases or are repossessed due to default in payment.These items then have to be put through several cost inducing steps that are then factored into the OLV.
As you can see, FMV and OLV are two separate valuations, but both essential in understanding expectations.We hope that the brief summation of the differences in valuations above can help your organization better understand what is realistic in the type of sale/purchase that they are embarking upon.MERC can help your organization with these types of transactions and help provide both Fair Market Valuations and Orderly Liquidation Values.Contact us with any questions or inquiries, we’d enjoy helping you in any way possible!
Liquidating a piece or group of medical equipment can be a complex task. That is why it is best to work with someone who understands the complexities and has the experience to put the pieces together to make it happen. Each equipment liquidation is dynamic in the sense that it depends on the purpose and speed of which the medical equipment or other assets need to be sold and moved. Understanding these circumstances and bringing about the best possible solution is what MERC brings to the table.
There are basically two extremes in liquidating an asset. On one side, you have the seller that is still using the item, but is nonchalantly seeking offers for the device(s) to see what the market might bring. On the other hand, you have the seller who needs to move their device(s) in a hurry for financial reasons. Both are trying to sell, but as you can imagine, bot have very different needs. Because of the different needs they have, desired outcomes must be adjusted. The seller who is actively using the piece of equipment and taking their time to test the market is probably looking for top dollar. The other seller on the contrary is looking to sell the equipment quickly to meet a financial objective. In either case, working with the seller to bring about the best solution is what is needed and why MERC prides itself in a custom-fit approach to our customers. In either case, a consultant has to be flexible to understand the dynamics of the issue and help bring the seller qualified buyers that fit their desired results. We not only understand these situations, but know how to bring the right solutions to them.
MERC also prides itself on being an advocate to the sale, not just trying to maximize our own revenues. For example, within the past year, MERC worked to help a surgery center close out its current location and move to its newer, larger facility. In this process, there was a desire to sell surplus items that were going to be replaced by newer items in the new location. MERC brought bona fide offers to the table to help liquidate the items giving the selling surgery center a baseline number for their assets. The selling surgery center had previous relationships with a used equipment buyer who also provided an offer. When it was found that both offers were fair and similar in price, the selling facility chose to go with their previous relationship to buy the equipment. Because MERC worked as an advocate for the facility to provide buyers to the project, it helped bring about the sale of the equipment even though it was not a buyer MERC brought to the table.
Understanding how to bring a solution to the desire to sell medical equipment is critical to our customers. As explained, MERC not only can develop offers to help facilitate a sale, but also in that can drive sales by creating competition from the bona fide offers we obtain from buyers. This is another way we bring value and service to our customers in a tailored approach. Feel free to contact us if you have any questions or would like any more information on how we can help your organization or facility with it’s liquidation needs.