Prepare Your Business for Sale [THA 315]

Did you know 80% of small businesses do not survive the departure of the current owner? When is the right time to prepare your business for sale? The day you opened your business! How do you maximize your selling price? Is there a simple way to quickly valuate your business? Hear from 3 business coaches on the importance of properly planning your business for sale.

Watch Episode HERE

Bob Ward, President of Wardden LLC, Look for Bob’s Previous Episode HERE. Perpetual Business Co website HERE.

Rick White, President and Lead Coach for 180BIZ, Listen to Rick’s previous episodes HERE.

Chris Cotton, AutoFix Auto Shop CoachingChris Cotton Weekly Blitz Podcast

Show Notes:

  • Understand your business Profitability
  • Selling your business properly takes planning- don’t have a reaction selling plan. Never make a decision in a ‘valley,’ aka emotional.
  • You can’t sell sweat equity.
  • Your business is for sale every day- every decision affects your business.
  • Your goal as an owner is to work your way out of the company, not get stuck in the job.
  • What is your identity? What is your identity post ownership?
  • To maximize your selling price, you need two things: Sustained profit (typically an 8 to 10 year runway) and a business that will operate without you.
  • Staff is aware and supportive of the owner’s succession desires and planning- everyone should be involved respectfully. Your team wants certainty. Create a haven where they can feel safe, do their job, be challenged, be a part of something, and have fun. Do you have the right people and team in place?
  • What is the market for selling your business?
  • 80% of small businesses do not survive the departure of the current owner.
  • Hiring is like fishing- know what fish, what bait will attract the fish, and where is that fish. Consider ‘ownership potential’ when hiring quality staff. Show a future no one else does.
  • What does training do? Improve skills and communication. The more we communicate, the less friction there is in the business.
  • Valuate your business- the stuff inside your building, cash flow, multiple average 2.5. Take your assets, 25 cents on the dollar plus inventory as part 1, then your cash flow multiplied by 2.5 to get a ballpark number.
  • 6 Metric Multiple- how independent is the business from the owner? Customer facing employees tenure, production staff tenure, stability, revenue trends, gross margin trends and SOP for business.
  • Multiplier- confidence factor. How confident will the new owner feel when the old owner is out?
  • Financial records are pure, accurate, and updated- get your balance sheet right, and don’t hide cash from the business.

Thanks to our Partners Shop-Ware and Delphi Technologies

Shop-Ware: More Time. More Profit. Shop-Ware Shop Management

Delphi Technologies: Keeping current on the latest vehicle systems and how to repair them is a must for today’s technicians.

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About the author, Carm Capriotto, AAP

Carm is the founder and host of the Remarkable Results Radio Podcast and the pioneer of automotive aftermarket podcasts. Carm calls on his years of experience in the aftermarket to bring engaging stories from his guests.

Listen to raw, unfiltered, honest, and sincere stories that include insights, trends, best practices, and expertise. Each interview brings an opportunity to learn one new thing through the stories of personal achievement. Many podcast guests tell their story of transformation from working in their business to working on it.

As host of over 1,000 episodes, Carm uses his enthusiasm and passion for the aftermarket especially the service sector to take his listeners on a journey showcasing successful service professionals’ paths to Remarkable Results. He also enjoys interviews with aftermarket industry thought leaders who bring their industry perspectives to his listener.

Follow the podcast on your favorite podcast listening app and always listen to learn just one thing!