As you assess your business’ strategic direction, it is always important to take a reflective moment and assess the Strengths, Weaknesses, Opportunities and Threats (SWOT) that can propel the total economic value of your business and the strategic options for your stakeholders. It is equally critical to understand areas which could potentially detract from its value. Whether you are on a growth trajectory or planning to explore a sale, merger or recapitalization, it is important to be aware and be prepared to address these key areas.
Strengths: Healthcare continues its necessary evolution as technology drives better outcomes, lowers costs and enables businesses to scale to unprecedented levels. Synergistic opportunities are also fueling business growth across previously divergent sectors. This is also driving M&A activity and fueling new buyer and investor focus.
Weaknesses: Rising costs and labor shortages. Regulatory and compliance demands. Disruptive advancements requiring cost management, business refinement and potentially new directions.
Opportunities: Diversification and scale. While not for the faint of heart (sic) the complexities of extending care amid rapidly changing regulatory demands provides barriers to entry. These barriers, while daunting to the novice, continue to drive opportunities for well established, market driven organizations. Large providers continue to see the value of population health initiatives including scaling operations across the continuum of care.
Threats: Third party payors. Reimbursement pressures continue to be a concern for providers drive the need for operating efficiencies amid declining profit margins. Disruptive initiatives will continue to threaten the status quo but also provide opportunities for those that are able to embrace them. A day of reckoning in some sectors with flat or declining margins and increasing labor costs.
For more information on M&A opportunities for your healthcare business, click here or call us at 800-719-1555
