Ahern & Associates has been involved in an M&A advisory capacity for clients for the past 28 years. The firm’s clients have been involved in over 450 acquisitions of transportation and logistics companies, and rely on Ahern’s expertise to assist sellers in identifying areas that need consistency, before a client approaches them.
Ahern reveals that in order to successfully sell a business, owners need to understand what it is that strategic buyers look for. He discusses the fact that an owner must be ready financially and mentally to sell. “The time to sell is based on a couple of variables,” he states. “If you want to protect your financial assets and you’re of a certain age, and you’re mentally prepared to let go, then that’s the time to sell. If you’re not mentally prepared to let go, or you’re not financially prepared to let go, or you’re suffering financially and feel that someone’s going to give you a pot of gold because you’re not making any money, then it’s not the time to sell.”
Mr. Ahern explains that preparing to sell a business is like planning your own funeral; it’s a very emotional process, so the first thing a seller needs to is to be mentally prepared and have something to do in the next phase in his or her life. If a seller will sell to a strategic buyer, the seller needs to recognize that the buyer is going to want the seller to be around for at least a two-year period to receive value for the business. Most sales are asset sales, so sellers need to get realistic about the value of the equipment is. Most strategic buyers want to cycle their own equipment, so sellers need to find out what the liquidation value is. If equipment is over-valued, a seller will have a difficult time selling the business. If sellers haven’t had consistent growth, they won’t get maximum value for their businesses.
Mr. Ahern then addresses the question, “When is the time to grow?” In order to stay in today’s market, companies must grow and cannot stay consistent. CSA compliance, Hours of Service, e-logs and more condition companies to either grow, sell, or liquidate. Since Ahern & Associates works with all types of companies, it isn’t a business broker and it doesn’t do contract negotiations or due diligence, the firm has been involved in over 450 transactions with clients, and Ahern’s staff knows exactly what strategic buyers are looking for, including intellectual capital. The time to sell is when a seller is emotionally prepared, financially prepared, and realistically prepared. The time to grow is if revenue is stagnant and the seller still wants to stay in the game.
Working within the confines of what owners have is key, says Ahern. The bottom line is if an owner is running 50 trucks but doesn’t want to increase liability, or expand the business, and has no one to pass the business off to, the company’s entire financial future could change. Sellers need to make a considerable effort in researching whether or not to sell.
For more information about Ahern and Associates, interested parties can visit www.ahern-ltd.com or call 602-242-1030.
About Ahern & Associates, Ltd.
Ahern and Associates is North America’s leading trucking and transportation management consulting firm. The skilled consultants at Ahern and Associates specialize in mergers and acquisitions of trucking and logistics companies as well as the restructuring and evaluation of existing carriers that seek to increase operating efficiency and improve profitability. Since 1987, Ahern and Associates has aided hundreds of buyers in the acquisition of trucking and logistics companies throughout the U.S. and Canada as well as assisting many transportation and logistics companies in reducing their overall operating costs and increasing their profitability.
For more information, please call 602-242-1030 or visit http://www.ahern-ltd.com.
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