Goodwill Loans for Pharmacists

Releasing the value in your practice

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Your pharmacy practice generates wealth. At Rangewell, we can set up Goodwill Loans to let you benefit from it.

At Rangewell we recognise your professional status, and we work harder to find you better solutions - which can include 100% finance for many of your needs.

Goodwill Loans For Pharmacies

And how you can make them work for you

A chemist's shop on the high street can create a great deal of wealth. However, tax rules and the need to maintain your working capital mean you can’t access the wealth you have created without causing problems for yourself or your business.

There is a way to enjoy the results of your hard work, and that solution is a goodwill loan or cash out. It can help you enjoy the wealth you create in your chemist shop and pharmacy, but leave the funds in your business bank account untouched. 

What is a pharmacy Goodwill Loan?

A goodwill or capital withdrawal loan allows certain professionals in the medical sector, including pharmacy owners, to access the value in their business without actually withdrawing funds from it.

It works by letting you use the goodwill already built up in your chemist shop as the security for a loan, and which you can use for a wide range of purposes and repay at a particularly attractive rate. A Goodwill Loan can provide you with a sum comparable to annual turnover, and is typically between £50,000 and £500,000, with repayment terms of up to 15 years.

Interested in learning how a goodwill loan could benefit you?

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How does a goodwill loan work?

Goodwill is a form of intangible asset which is associated with the purchase of one company by another. Goodwill is the portion of the purchase price that is higher than the sum of the new value of all the assets purchased and the liabilities included in the process. These are things like the company's brand name, its existing customer base, the customer relationships. Additionally, proprietary technologies will be the reasons why goodwill exists. In a nutshell, goodwill is any property that is not easily quantifiable. 

The process of goodwill is relatively straightforward but, in practice, can be pretty complex. To determine the value of goodwill, take the company's purchase price and then subtract the net fair market value of identifiable assets and liabilities. 

What can your pharmacy business do with a Goodwill Loan?

You can use your Goodwill Loan for business or even personal purposes. There are a few limits on what you can do with your loan - you can’t use it to pay off your mortgage on your main home - but otherwise, you can use the funds in almost any way that you wish, including:

  • Buying property in the UK overseas for investment
  • Buying a second home
  • Paying for education
  • Buying another business
  • Buying a second shop to expand your existing pharmacy operation
  • To support retirement planning or investments

Don't just take our word for it, here's what one of our happy customers had to say.

"I wanted to buy a holiday home - as an investment and something to enjoy. I couldn’t take the money out of the business for the deposit, even though it was there, without running into problems with tax and cash flow. But a talk with the pharmacy funding professional at Rangewell showed me that a goodwill loan was not only possible but would make very good sense. I bought a cottage in Devon - and Rangewell helped with the mortgage too.”

To find out more about a Goodwill Loan for your pharmacy practice. Call and talk to our physiotherapy business experts. Other funding solutions for pharmacists include:

  • Asset Finance 
  • Hire Purchase 
  • Leasing 
  • Vehicle finance
  • Commercial Mortgages 
  • Secured and Unsecured lending
  • Merchant Cash Advance
  • Working Capital Finance
  • Revolving Credit Facilities 
  • Invoice Finance 
  • Merchant Cash Advance

What are the benefits of Goodwill loans?

The significant benefits of intangible assets and goodwill are:

They enhance the value of the business: Intangible assets will play a big part in strengthening the role of the business. For example, customer perception and the reputation of the company on the market are the most critical elements in the success of any business. In addition, the world is changing, more businesses are building a presence online, and the importance of intangible assets such as intellectual property, knowledge and business relationships are increasing.

They're an excellent investment: Managing and accounting for intangible assets is a form of investment compared to having a robust asset base. As a result, companies can earn a significant premium compared to the costs incurred but acquiring equipment and the costs of maintaining them.

For example, the company would incur buying and manufacturing costs, maintenance costs, depreciation expenses, and obsolescence costs for a tangible asset. 

For companies to stand out against competitors in the industry, the company needs to recognise that intangible assets are unique elements. 

Drawbacks of intangible assets and goodwill are:

It can be complex: Intangible asset valuation is a complex process and needs expert understanding, approaches, and exercises. 

Unsure which type of finance you need to answer your current business challenge?

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What are the limitations of Goodwill loans?

There are a few limits on what you can do with your loan. For example, you can’t use it to pay off your mortgage on your primary home.

Goodwill is difficult to price, and negative goodwill can occur when an acquirer purchases the company for less than market value. This will usually happen when the target company doesn't negotiate a fair price for its acquisition. As a result, negative goodwill is generally seen as a distressed sale and will be recorded on the acquirer's statement. 

There is also the risk that the previous company could face insolvency. When this issue happens, investors may deduct goodwill for their calculations of residential equity. 

Discover our range of finances

Every type of finance for every type of business

Our goal is very simple - to help businesses find the right type of finance as quickly, transparently and painlessly as possible.

Helping you build your profits

  • Cash never leaves your business
    A Goodwill Loan means you can unlock funding whilst leaving your business finances completely unaffected.
  • Versatile funding for any purpose
    A Goodwill Loan can be used for most purposes, with some exceptions, from investment or buying property or simply for leisure.
  • No need for additional security
    Goodwill Loans are secured on the future performance of your pharmacy practice - which means there is no need to put your own assets or possessions at risk.
  • Competitive rate funding
    Goodwill Loans represent a very cost-effective way to borrow, as repayment rates can be very competitive.
  • Some providers will accept early repayment
    Some Goodwill Loan providers will accept early repayments, reducing the total cost of your borrowing - and helping your loan to pay for itself.
  • Helping to avoid tax implications
    Your Goodwill Loan will let you benefit from the value built up in your pharmacy practice, with no tax implications for you or your business.

Download Rangewell’s free and detailed guide to Finance for Pharmacists

What types of finance are there - which do you need?

Why not all providers are equal - finding the one that’s right for you

How we can provide an additional income stream

The downsides to finance - and how to avoid them

Do I need to use a lender who is authorised and regulated by the financial conduct authority?

 What different finance packages are available for cash flow, a pharmacy purchase or partner buy-in/out?

How to arrange finance - what paperwork do you need?

Do lenders look at pharmacies' finances when making a lending decision?

Key terms explained

Find out your finance options for all your needs

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Getting the right funding arrangement is essentialThere are many forms of business finance available. Getting the most appropriate type for the business needs of your pharmacy is essential to avoid excessive costs
Your key equipment could be at riskIf you are unable to keep up repayments on a hire purchase or lease agreement, the equipment your practice depends on could be could be at risk.
Long-term financial commitmentsYou may not be able to pull out of a finance arrangement once set up.

Frequently asked questions

Have a question?

Can you borrow against goodwill?

Every lender will have different criteria, so you should speak to Rangewell's expert goodwill brokers to gain all the information you need to find the right deal for you and your business needs. Lenders may typically finance somewhere between 50% to 80%. Repayment terms will be up to 36 months, but 10 months is more common. The APR can be anything between 4% to 99%, but this will depend on the lender, loan terms and creditworthiness. 

Can you borrow against intangible assets?

The main issue is that intangible assets will change in value. Therefore banks will not lend against them. Expert goodwill brokers such as Rangewell can provide you with everything you need to gain a better understanding of goodwill lending. 

We'd recommend you work with a goodwill mortgage broker - they can provide you with bespoke deals that banks may not be able to offer. A goodwill loan can be an important additional asset for your personal financial plans, and give you a great deal of extra spending power.

What information do I need to apply for a goodwill loan?

Rangewell will tell you precisely what you need to know when applying for a goodwill loan. Typically, lenders will want to look at the following information:

  • Financial statements of the existing practice being acquired (most lenders will prefer 2-3 years)
  • Personal financials 
  • Purchase contracts

Speak to Rangewell today to find out how we can help you with goodwill for your pharmacy. 

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