- July 19, 2019 at 2:56 am #91599carmancapriottoParticipant
Are you ready to sell your business? Do you know how to prepare? Is it a buyers market or a seller’s market? Do you understand some of the financial principles that drive a transaction? About 50% of you will be impacted by this discussion in the near future.
We cover a large swatch of ground as we talk about the incredible opportunity for sellers as the industry consolidates, getting your financials right, processes, leases, and the all-important EBITDA number.
The panel includes three members of Cardinal Brokers: Norm Gaither, Dennis McCarron, Joel Zaleski and a shop owner who recently sold his business Jeff Pohlman Retired from Jeff Pohlman Tire a 5 Locations operation.July 27, 2019 at 5:45 pm #91743J. Larry BloodworthParticipant
What a great podcast! While the podcast is absolutely 100% on target, it’s my belief that many shop owners who wish to sell are selling because they aren’t making the money they thought they should. When this is the case, a lot of the podcast’s content won’t apply.
I know of a 70-year old multi-shop shop owner who wanted to sell his poorest performing shops. He hired a consultant/broker to help get things in order for the sale. He was advised that unlike selling a profitable shop, selling an unprofitable shop for the maximum profit is a 3-year process. This is because a 3-year track record of profits would be necessary. Otherwise, he had nothing to sell but the real estate, which he did not own. He was also advised that he would more than likely have to carry paper on a portion of the sale price. Because of that, he was further advised that if someone takes over the shop and continues to not make a profit, he would more than likely lose everything he was carrying on paper.
He opted for the 3-year plan. Over the course of 3 years, the shops he was selling only became profitable during the 3rd year. After seeing a steady trend toward profitability, he decided not to sell the shops. I only relate this story to motivate shop owners wanting to sell their shop to REALLY DIG for the real reason they want to sell. Sometimes age is only a convenient excuse to camouflage unprofitability.
Acid test question: “If you were making the money you think you should, would you still sell?”
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