Even though the economy is now showing signs of stability, the wait-and-see approach of sellers further contributes to the decline in businesses-for-sale…which is good for those sellers that are selling, (high demand- low inventory-top dollar) …but these conditions won’t last forever as the average age of restoration business owners is around 58 years old ..no one can pinpoint exactly when this will happen …but we anticipate that at some point there will be an oversupply of restoration businesses in the market with many owners wanting to retire …we are recommending to our clients that if you have less than a 5 yr horizon on running your business …it is better to exit sooner rather than later. The time to begin succession planning for your restoration business is now.
Business owners are enjoying the current state of the economy and don’t understand why you would want to sell when things are going great. Now the owners of restoration businesses are either delaying succession planning or completely failing to factor it into their management decisions. Lots of restoration business owners do not vision their business having cycles …the good times won’t last forever. On the buyer’s side of the equation, the concerns are obvious – their confidence in the economy is a positive one , interest rates are low and there is an unusual amount of private equity firms buying companies to consolidate into one big national platform…..all for which are bidding up prices for healthy restoration companies.
It’s important to understand the many ways in which a strategic succession plan can increase your profits and cash flow – right now – while enhancing the value of your restoration business when it’s time to sell. Don’t wait for the economy to fail again before deciding when you want to sell your restoration business.