Putting your ambulance company for sale with a local business broker or real estate agent may help stimulate the local economy, but it probably won’t stimulate your sale price. Some business sellers go local in hopes of saving a few bucks. But because regional brokers work within a smaller market, they are much more likely to generalize. One day a local brokerage firm may sell a coin laundry business, and the next day a burger joint. Do you really want to be the first ambulance business your broker attempts to sell? When you operate in an industry as unique as the medical transportation business, it pays to specialize.
1. Limited Connections
Sometimes it’s not what you know, but who you know. General business brokers rarely think outside of the box when it comes to marketing companies, relying primarily on online business listings and local classifieds. This limits the pool of prospective buyers significantly. At a local level, your only qualified buyers may be similarly-sized competitors who can’t afford your asking price. On a business sale exchange that lists thousands of companies, an ambulance business for sale can easily go unnoticed. The reality is that your best buyer may not be located anywhere nearby. Currently, the average distance between The Tenney Group’s sellers and buyers is 400 miles. Brokers specializing in the transportation business rely on their industry network to target and attract buyers with the most to gain from buying your business. By increasing exposure, business owners increase their chances of reaching an interested – and possibly high-paying – buyer.
2. Lack of Industry Experience
A local business broker may sell hundreds of types of businesses per year, many of which are brick-and-mortar properties. It can be difficult for them to grasp the value in a medical transportation business that relies on vehicles and customer service rather than storefronts and products. Ambulance companies face unique challenges such as health department regulation, Medicare ambulance reimbursement, and increased market consolidation. When it’s time to negotiate, general brokers may not fully understand how these factors come into play. A broker who understands what an ambulance business buyer is looking for can leverage that knowledge to present your business in the most appealing light.
3. Tendency to Overlook Value
There are seemingly endless methods for calculating a company’s business value, but ultimately value is subjective. Sure, most methods take into account quantifiable factors such as cash flow and assets. However, to be accurate, a valuation should also include intangibles like goodwill. Has your NEMT business built a trusted brand? Are you the sole ambulance service provider in a particular region? Have you already invested in the latest and greatest medical equipment? While difficult to measure, these assets may lower costs and reduce risk for a new owner. An amateur broker may overlook the hidden value in an ambulance business for sale, while an industry expert can identify and communicate unique details to the buyers most likely to be intrigued by them – and most willing to pay a premium as a result.