If you are a small business owner, particularly of an auto parts store, you have probably poured more than a little of yourself into the business over the years. Like a proud parent, you have watched this enterprise grow and blossom, undoubtedly into a much larger venture than when you first began. But, lately, you have found that running your auto parts business has become less enjoyable. Quite possibly, you may have found yourself restless with the extended hours and time away from your family. Maybe your sales have begun to level off or even decline. The question has entered your mind: is it time to think about selling the business?
Perhaps this question is the most difficult question a business owner will ever have to answer. The following three-minute quiz for auto parts store owners will help you assess your true inclination to sell your business.
CONSIDER ALL PARTS OF THE QUESTION
More important than deciding on the selling price of your business, or even devising the method or terms by which you will sell, the most important determination is: Do you really want to sell your business? Over the years, you have dedicated most of your time, energy and resources to your business. The business has, no doubt, been discussed endlessly around your familys dinner table and has been a very important part of your familys lives. In some cases, a store owners whole family depends on the income generated by the business. You may even see the store as an extension of yourself, and it may be hard to imagine life without it. Can you actually sell this business?
It is imperative that you consider all aspects of this question. Not the least of these considerations are your employees. In fact, many of these employees may have worked for you for many years, investing as much of themselves in the success of the business as you have, at least in terms of their skills and their loyalty. You will want to take their long-term security and peace of mind into consideration as you make your plan to sell. You must understand, after all, that your skilled employees are the true knowledge base of your business and their expertise has paid off in customer satisfaction.
As you are making this resolve to sell, you will also want to consider the long-term customer and vendor relationships you have worked so hard to establish. How will these valuable assets be preserved once the business sports an "Under New Ownership" sign? When all of these aspects of the question have been carefully considered and answered to your satisfaction, you will have taken the first and most vital step in the business sale process. It is important for you to proceed forward in the business sale process now in order to maximize the amount of cash you will realize from the sale of your auto parts store.
MAKE A LIST OF YOUR GOALS
Ask yourself what you expect to accomplish or achieve by selling your business. You need to set and prioritize your goals now because they will become of primary importance later when you are in the final stages of negotiations with the buyer. If you take the time to complete this goal-setting exercise now, it will pay off in dividends down the road. When the process is finished, you may be surprised to discover what is really important to you personally and in terms of your company and its legacy.
Every auto parts store owner who is seriously thinking about selling his or her business should at the very least answer the following questions and honestly confront these issues.
- What are the five main reasons you are considering the sale of your business?
- What do you want to gain personally from the sale of your business?
- What does your spouse want from the sale of the business, and how will the sale affect him or her?
- If you have children in the business, what if any continued roles do you see for them?
- When would you like the sale to be completed?
- Do you feel financial or other obligations to your management team, counter sales professionals, outside sales people or other employees?
- What are some of the characteristics you are looking for in a qualified buyer?
- What is your hope for the future of your business after it is sold?
- Would you consider remaining at your business, either part-time or full-time, after the sale?
- Would you consider remaining with your company for a transitional period after the sale?
- If you own your real estate, do you want to retain it separately and lease it to the new owner, or would you prefer to sell it with the business?
- If no real estate were involved, would it matter to you if the buyer moved your business or closed it and merged it into his or her business?
- Will it be important to you that the sale of your business be kept confidential from your employees and customers? How important will discretion be to you?
- What kind of professional help will you need with the transaction, and do you know where to find it?
This article will be continued in next months issue.
Tom Easton is vice president of Business Resale Association, Inc.,a Kansas City-based firm that specializes in the sale of auto parts stores to financially qualified buyers who are willing to relocate. He is the "jobber advocate" and intermediary, while others in the firm identify, qualify and represent potential buyers. To learn more, contact Tom at 704-756-5532.