THE SAME IS TRUE ABOUT SELLING A DEALERSHIP!
Whatever the reason is for considering the sale of your dealership,
there are certain steps you can take that will lead to more money you can
keep of the sale proceeds. This includes what the income tax consequences
of the sale.
One of the best articles we have ever read about selling a business
was written by Dr. Art DeThomas, professor emeritus of business at Valdosta
State University. We will be happy to mail you a copy if you will call, fax
or email your request with your mailing address. It will come in a plain
white envelope. We will even mail it to your home if you are concerned about
employees seeing it.
Outside of Professor DeThomas' article, there are other things we
recommend and are willing to help you with. The first is to start preparing
for the sale early, preferably a year ahead. Not to say that there are some
circumstances that this is not possible. In this case we can help make the
most of what we have.
Clean up your financial statement! Get rid of all the relatives salaries
on the payroll, quit paying country club dues from the company, and any other
unnecessary expense items that reduce the profitability of the dealership. Work
real hard to sell more cars with a better gross. Push F&I income, extend warranties and
anything else that will add to the bottom line. Run some service specials; pay bonuses for
up-selling to produce higher ROs. We will be happy to review your financial statements and
make recommendations for areas of improvement.
Most buyers would rather pay more for a successful dealership than one that
is in serious neglect. Blue Sky/Goodwill are probably the only areas you can increase
the selling price of your dealership. Real estate usually sells for appraised value,
parts are book value, used cars are wholesale value, fixed assets are usually at
appraised value or close to it. It will make your dealership sell faster and for more
money if you spend some time to have a better looking financial statement.
Call us ahead of time. We feel that if we can prove ourselves to you by preparing
your dealership for sale, we can earn the right to sell it when the time comes.