Simplify the complex
Company: Wholesale & Distribution
Time to sell: 2-3 months after a new campaign
Sold: Within 5% of asking price
After 17 years of owning, growing and running the business, involved in the import, wholesale and distribution of horticultural products, the two owners were keen to pursue other passions. Turnover had grown to more than $4.5 million, with good sustainable profits in excess of $800,000.
The owners had worked long and hard to make this a successful business and it was time for some new blood to take the business forward. The owners had set up systems, leases, plant and personnel that would allow for an easy and seamless ownership transfer.
The price expectation – although not unrealistic – was at the top end. The owners hoped to achieve a successful sale within 6-8 months.
We began the sales process by building a solid foundation, which entailed a quality information memorandum, print media promotions and reaching contacts through our extensive database. After 8-9 months we could see this did not seem to be working.
After a few months, we understood that we would need a fresh approach – to have a new broker from LINK in charge, to review the information memorandum and relaunch a marketing campaign with new print media promotions. The innovative approach was to market the business (which was complex in nature) without a price, but provide enough information to clarify and simplify the complexities of the business. This was designed to let prospective buyers form their own opinions of the business value.
This approach worked, and within a few weeks of implementing the new plan we had negotiated an agreed price between the seller and the buyer. This was a very satisfactory outcome for the exiting owners, as well as the happy buyer, who continues to run and grow the business.