There are many steps business owners must take to prepare a chauffeur business for sale. But perhaps the most important one is to ensure the business is sellable in the first place.
Owners who assume their company will find a buyer right off the bat may be in for a rude surprise. According to the International Business Brokers Association, the average small business takes 9-12 months to sell – and that’s no guarantee you’ll get the price you want when you do find a taker. But business owners don’t have to settle for average. By analyzing the appeal of your transportation business before you take it to market, it may be possible to increase salability – and price.
How predictable are profits?
Some buyers are looking for immediate cash flow, while others will accept slim margins today if bigger returns are probable down the road. What they all have in common, however, is a desire for predictability. Investors need to know that buying a limo business will pay off. You may have had a great year, but it won’t mean much to investors if last year was a bust. Between shifting economic conditions and changing regulations, it’s impossible to guarantee smooth sailing in the limo industry. But by making stabilizing changes – such as reducing customer concentration or updating technology – business owners can often boost buyer confidence.
How reliant is the business on you?
Your business may run smooth as clockwork when you’re around, but what about when you’re gone? A company that is highly dependent on any one person represents a serious risk for a new owner. When customers associate your limo business with your personality, they may leave when you do. If essential policies and procedures exist in your head rather than on paper, your departure could jeopardize operations. Even if you don’t plan on selling, an unexpected illness or injury that keeps you out of the office could erode business value in your absence. It may seem counter intuitive, but the most successful owners know to keep their distance.
How secure are customer contracts?
One of the biggest benefits to buying a limo business for sale is the ability to inherit customers. Picking up new clients is time-consuming, expensive, and challenging. When clients come with the business, however, a new owner can immediately begin providing limo services – and earning limo business profits. If you’re considering a sale, now is the time to reaffirm relationships with key clients, lengthen existing contracts when possible, and diversify by adding new customers.
How flexible are you willing to be?
Not every business will have the ideal balance of attractive attributes. Whether your performance record is less than smooth or your customer base is on the concentrated side, you may be able to offset your negatives during the negotiation process. By offering owner training, agreeing to finance part of a purchase, or compromising on deal structure, sellers can increase appeal to buyers – and boost the odds of a quick and rewarding sale.