How can I tell if a non-emergency medical transport company is profitable?

A transport company’s profit depends on how many paid trips each vehicle and driver completes in a day. Financial statements show the result, but not the reasons. A careful buyer looks behind them at the operating records, because those records either support the story the seller tells or they do not.

Start with trip logs and invoices

Ask for a sample of trip logs, dispatch records and the invoices that match them, then follow a handful of invoices into the bank deposits. Do the trips, the billed amounts and the money received agree? Gaps may have innocent causes, such as late payers or cancelled rides, but they should be explained. Your accountant can design the test.

Look for lost time

Two things quietly drain a transport business. One is the empty return leg, when the van drives back without a rider. The other is waiting, when a driver sits through an appointment. Ask how the company charges for each, and whether dispatchers group nearby trips. Also ask how many hours a vehicle actually earns, compared with the hours it is staffed.

Compare the customer mix

Contract work from facilities and agencies tends to be steadier but may pay on a slower schedule. Private riders may pay differently and book less predictably. Ask for revenue split by customer type and by customer, and see whether one account carries too much. The page on checking whether a private medical lab is profitable shows the same habit in another health business.

Check the costs that fall on the owner

Look at fuel, repairs, insurance, driver pay and vehicle replacement, and ask what the owner earns for the work he or she does. If the owner drives or dispatches, a buyer must pay someone to do that. This page does not set a price; the due diligence guide lists further checks.