Advice on Niche Market Exit Planning
Selling a Towing Information and Referral Services Business
Most businesses are susceptible to economic conditions and towing information and referral services businesses are no exception. But in some cases, a down economy can actually improve saleability. All it takes is a strategy to identify solid prospects and convert them to buyers.
You need to get a good price for your towing information and referral services business. To get there, you'll need to set realistic expectations and follow a deliberate selling strategy.
Despite the conventional wisdom, we believe current economic conditions are right for selling a towing information and referral services business. Here's how to do it . . .
Working with Appraisers
An experienced appraiser is part and parcel of a successful towing information and referral services business sale. Leading industry appraisers equip sellers with a value gauge that can be accessed during negotiations. If you're disappointed with the appraiser's estimate of your company's worth, you have the option of seeking a second opinion. However, it's more often the case that you will need to adjust your expectations of your business's value to buyers.
Valuation Methods
The methods for valuing a towing information and referral services business vary according to your business model and circumstances. However, there are generally three valuation methods appraisers use to determine your company's worth. Appraisals based on the asset method gauge value as a factor of the company's real property and non-tangible assets; appraisals based on the income method consider the business's anticipated revenue. In many sales, the most accurate valuation comes from the market method which determines value based on the recent sales of similar businesses. A good appraiser will often use multiple valuation methods to arrive at a reasonable estimate. Sellers should take note of the fact that all three valuation methods reward businesses that takes steps to increase assets and income.
Finding Prospects
Many sellers don't realize how many prospective buyers there are for their businesses. We frequently see qualified buyers emerge from the seller's network of business and personal acquaintances. In other cases, sellers take a proactive approach to finding likely buyers and contacting them directly. If possible, steer clear of selling to a competitor if for no other reason than the fact that competitors pay less for towing information and referral services businesses than other buyers.
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