| Success Stories Index > Kearney
Celebrating Success Across Nebraska!
A Prescription for business growth
When pharmacist Jerry Jensen needed a business valuation report, his banker prescribed a visit to the Kearney office of the Nebraska Business Development Center.
Jensen owns Medicap Pharmacy in Kearney. Its prime location and the loyalty of his customers has yielded stability and in some cases growth at a time when the overall economy was struggling.
After several years in business, Jensen was presented the opportunity to buy out his contract with the Medicap franchisor, but with financing by the parent company at a significantly higher rate than current interest rates. So he approached his banker about a financial restructuring of his company to secure new financing, buy out the corporate note and return more cash flow to his business.
Together they called upon Odee Ingersoll, director of the NBDC office at the University of Nebraska at Kearney. Like other NBDC directors, Ingersoll has impressive credentials. He is an Accredited Valuation Analyst, Certified Exit Planning Advisor, Certified Economic Development Finance Professional, Certified Business Planning Advisor, as well as a member of the Institute of Business Appraisers and the National Association of Certified Valuation Analysts.
As is often the case with a business in the medical industry, a company’s value is in part due to its professional operation, requiring a valuation of intangible assets such as goodwill. NBDC provided a business valuation to the lender to support SBA financing, at Fair Market Value.
Ingersoll then put together a comprehensive loan package including financial analysis, market and industry analysis, site evaluation, pro forma financials and premium market research. The proposal demonstrated significant long-term and short-term financial benefit to the restructure.
The package was given to Jensen’s bank and sent on to the Small Business Administration (SBA), which later approved the loan. With the funds from his bank, Jensen was able to successfully retire the franchisor note.
“This will save me $1.5 million over the term of the 20-year franchise agreement,” Jensen says. “It was a smart move.”
Running his own pharmacy means long hours. Jensen often works six days a week, but the addition of a part-time pharmacist now allows him to alternate weekends. He employs two people full-time and five others part-time.
“We’ve been fortunate that this is a very strong market,” he says. “We have somewhat of a medical hub here, and the medical community is very progressive. Even in a downward economy, Kearney has been in a little bubble, insulated from some of the worst effects.”
That’s why Jensen sees continued growth on the horizon. “I’m always optimistic,” he says. “You shouldn’t be in business for yourself if you’re not an optimistic person.”
NBDC Consultant: Odee ingersoll, director, kearney center