The automotive retail sector continues to be hot in the M&A industry. Family offices, private equity groups and other private investors are looking for ways to expand their portfolios. It is not rare to see such activity in the automotive retail sector. What is rare is the generational dealers, those who are two and three generations in, deciding to move on from the industry because they are disenfranchised by the grind with the customers, manufacturers, etc. and are not receiving the most out of all they have built.
Regardless of who is looking to make an acquisition, the end goal is typically the same; The best deal for the right amount of money. In order to ensure your dealership or group can negotiate for the price you want you must ensure you’ve built the most amount of value in your business. We argue in order to ensure you have (or are working towards) the highest value in your business, you need to be analyzing these areas of the Succession Matrix®:
- Owner Motivation & Perspective
- Personal Financial Planning
- Business Structuring
- Business Performance
- Strategic Planning
- Leadership & Management Continuity
- Management Synergy & Teamwork
- Successor Identification & Preparation
If you are looking to purchase a dealership, consider the Succession Matrix® factors and identify areas in which you might see a weakness and therefore have an opportunity to negotiate, knowing that perhaps there is money on the table. As we said earlier, the “best deals” are the ones where attention to detail has been placed in the factors above.
Click the following link to read Champ Rawls’s post on the Automotive Buy Sell Report’s website titled: Balance sheet and goodwill not only areas a dealership can add value in a buy-sell
Read the article and then contact us to get some insights on your own scenario. Even if you don’t become a client, a few minutes with us may help you save years of headaches. Contact Us