Are you ready to sell your business? John Coon is.
After more than three decades in the parts business, John is getting out. It wasnt an easy decision, but hes selling his store – the very same one that his father and uncle started in Copley, OH, in 1963.
"Either you grow, or you get out," conceded John. "It takes a lot of effort to grow a parts business, especially considering the kinds of inventory requirements you need. Long term, I wanted to find someone to run the business who has the energy and desire to expand it."
John is part of a growing population of store owners who are characterized as long-term independent business owners and who are approaching middle age. Typically they have no clear succession plans for the business, and they have an uneasy feeling about the future of the parts distribution market.
"Id be surprised if there are half as many independents in 10 years as there are today," said John. "More and more stores are becoming either a JV or company-owned store. Plus the retailers presence is being felt more strongly.
"Unfortunately, its all about the nickel these days," he continued. "That really takes the satisfaction out of the job. There used to be a lot of loyalty among customers. Today, theres just way too much throat cutting going on and not enough cooperation."
Fortunately, once the word got out that John was looking to sell, the calls started coming in. He eventually found another local NAPA jobber who was looking to expand. Not surprisingly, one of Johns biggest concerns was the stores employees, so he made sure they knew all of the details throughout the process.
"Its a big change for them, and they are understandably apprehensive," he explained. "I think it has been an open process. They know the new owner, and they know the reasons for the sale. I think they feel fairly reassured that things will be okay. Its never easy when these things happen."
But they do happen often. Every year, many auto parts stores change hands – some as part of giant store group and WD consolidations, such as GPCs recent acquisition of NAPA Hawaii. Others (as in Johns case) are consolidations on a much smaller scale. For those looking to sell, John has some sage advice: Dont wait to start thinking about who will run your business when you are no longer able or willing.
"This is still a viable business for people who are business oriented, like to crunch the numbers and are strong operationally. But all business owners should start grooming someone right away to take over the business someday."
John is right: Someday can sneak up on you and your business faster than you think. If someday is today, and you think youre ready to sell, be prepared, think it though and read this months cover feature, Ready to Sell Your Store?, which starts on page 20.
The task of selling your business is not a simple one, and this article is the first in a four-part series that will walk you down the divestiture path, should you choose to take it.