How to Sell an Auto Repair Shop for the Best Price

how to sell an auto repair shopAuto repair, one of the most viable markets in the Auto Service Industry, is essential to the American way of life. In the U.S., we average two vehicles per household. Cars don’t last forever, so most everyone will have to visit an auto body shop once or twice in their vehicle’s lifetime, which means that the aftermarket value is great. According to the Autocare Association, while the repair/replacement market value for vehicles under four years old is only $20.7 billion, the value of the aftermarket for cars over eight years almost quadruples to $77.3 billion.

But that doesn’t mean the auto repair business is easy money. As a consumer-facing entity, auto body shops rely on superb customer service to keep patrons coming back. They also depend on their clients as a marketing tool: satisfied customers will spread the word, bringing in new business and potential life-long clients. If run correctly, automotive repair shops can flourish. Consumers are often fiercely loyal to an honest auto repairman that completes quality work, at fair prices.

Competition is tough, though, with both privately-owned shops and franchised chains saturating the market. If you’re thinking of selling your body shop in the near future, you could be positioned to capitalize on your years in the industry. 

Don’t know where to start? No problem–Sunbelt Business Brokers is here to help. Because we sell more businesses than anyone else in the world, we know a thing or two about handling sales. Read on for steps on how to sell an auto repair shop for the best price.

  1. Prepare Your Business Records

First things first: prepare your official records. Potential buyers want to see official documentation, and lots of numbers, to verify that your business is a successful entity with the ability to show a return on investment (ROI), and worthy of your asking price.

Take time to compile all the necessary paperwork, including but not limited to: detailed financial records like IRS tax filings or returns, annual reports that show profit gain or losses, inventory logs, lists of vendors, etc. You may need to work with an attorney or accountant to complete this step.

Having these documents on hand will show that your auto repair shop is a reputable place of business, organized in such a way that it would provide a seamless transition to a new owner.

  1. Obtain a Formal Business Valuation

Next, you’ll need to get a formal business valuation of your auto repair shop. Business valuations are complicated processes that depend on everything from reputation to location, net sales to market competition. Potential buyers are interested in all of this information and will be expecting a complete, thorough business valuation review before negotiations begin.

There are different ways to conduct a business valuation, and the methods differ based on business aspects such as fair value, market value, investment value, liquidation value, etc. Many standards of value, databases, and calculations are used when conducting a formal business valuation, so it may be best to enlist professional help.

  1. Contact a Business Broker to Sell an Auto Repair Shop

Because business valuations are so sophisticated, it is vitally important that you enlist the expertise of a professional business broker who will show you how to sell your auto repair shop and guide you through each part of the process.

With locations around the country, your resident Sunbelt Business Broker is the best choice when it comes to business brokerage services. Our Sunbelt Brokers have years of proven experience in a wide variety of industries, as well as local market knowledge that can make all the difference in the sale of your auto body shop.

  1. List Your Auto Repair Shop for Sale   

After you’ve received your official business valuation for your auto repair shop, it is time to list the company for sale. While you can take on the responsibility of listing your business independently, it is best to use your business broker for this step as well. Certified business brokers can reach the largest pool of potential buyers, thanks to their expansive network and advanced databases. They can also help you complete the final details like terms of sale, and final closing.

There may be no better time to sell an auto repair shop, so when you’re ready, reach out to Sunbelt Business Brokers for assistance. For over 30 years, we’ve helped business owners such as yourself successfully sell their companies for the best price possible. Contact your local Sunbelt office today.

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