Leveraging Optimism and Realism in Transportation Business Sales

Okay, I guess there’s a third option other than optimism and realism: You could be a pessimist, but we’re already assuming you’re not one of those. As a transportation business owner, it’s important to maintain a positive disposition, but at the same time, you need to be realistic as you set out to put your transportation business for sale. While it would be nice if you could really determine your sale price simply by wishing for it, that scenario simply isn’t tied to real life. In some ways, you should hope for the best while being prepared for the worst. Ultimately, your sale price will probably reflect a combination of your business’s value, the market’s conditions, and your buyer’s circumstances.

Your Business’s Value

Optimists often have high expectations of a high sale price. Listing a business at a price above a realistic sale price can frequently provide frustration, though. Understanding business valuation can be helpful in leveraging your asking price to produce the best possible outcome of your sale. Instead of starting with an industry-specific business valuation like the TransValuation offered by The Tenney Group, business owners often begin with the amount they desire to get out of the sale. For those nearing retirement age, they may determine an amount based on what they figure they’ll require to live a comfortable lifestyle throughout their retirement years. When the sale takes longer than anticipated, those owners often fall prey to frustration. To avoid this scenario, you can start by setting a realistic sale price. If your business valuation proves disappointing, transportation-business specialists can help you make strategic alterations to increase your business value before you put it on the market.

The Market’s Conditions

Especially in a struggling economy just barely creeping out from under a major recession, today’s business owners know that they’ll have to compromise in order to get a deal. While many may be hesitant to offer notes or make other financing provisions, inflexibility can cause an ideal buyer to look elsewhere for a transportation business in which to invest. Offering seller financing, owner training, or other options up-front can help position you to receive both a better price and a smoother deal. Experienced transportation-industry intermediaries can help you maintain fairness throughout the negotiating process, resulting in a financially favorable result for you as the seller.

Your Buyer’s Circumstances

A huge step toward an ideal sale scenario is determining your ideal buyer type, the one who has the most to gain by purchasing your transportation business. Is it someone who’s looking to buy a stable company? Then you need to focus on increasing cash flow. Is it a strategic buyer focused on reduced costs or greater market share? Then you need to prioritize reinvestments that promise long-run returns. Regardless of what you perceive your ideal buyer to be like, that person probably won’t fall into your lap. Transportation business brokers can leverage their vast resources and industry-wide credibility to connect you with ideal buyers you wouldn’t otherwise be able to access.