Every day, business owners across the country miss out on what could be the financial opportunity of a lifetime when they refuse to even consider an unsolicited offer. Instead of bristling at a proposal, take it as a compliment. While you’re certainly not obligated to accept the offer (especially one that was sprung on you suddenly) considering your options will ensure you won’t regret your decision in the future.
It’s understandable to react a bit irrationally when caught off guard. But while you can’t prevent surprises, you can prepare for them. It’s a fact of life that every owner will sell or transfer their company someday. Even if you don’t plan on parting with your paratransit company anytime soon, an unexpected family or financial crisis could change your mind. Being forced to sell suddenly can mean liquidation or selling on somebody else’s terms, both of which can result in less than fair market value. Being prepared to sell your business can put you in a better position to call the shots when the time arises.
There’s no reason you shouldn’t be ready to at least entertain an offer, especially if it happens to be from a well-funded buyer. In the course of your career, you may get just one chance to make a deal with your best buyer. Often times, a strategic buyer can justify a higher price by taking into account not just your current earnings, but your company’s future potential for profit. This may include factors like your clients, location, and market. However, these factors are not guaranteed to remain stable. From changing regulations to a shift towards national healthcare, the ambulance industry may not be the same just a few years from now. As a result, offers won’t be the same either.
Receiving an offer can serve as an important reminder to reevaluate your business plan. Where do you see yourself in 5 years, 10 years, or beyond? Can you predict the outlook for the medical transportation industry? You may decide that your best bet is to cash in your chips earlier than expected. If you are not ready to walk away from your company, perhaps you can negotiate the ability to stay on as an employee.
Seek professional advice
It can be easy for sellers to misunderstand an offer from a buyer. Value is a complex number made up of obvious components, such as your cash flow and physical assets, and non-tangible factors, such as your licenses and permits or your safety record. When it comes to selling an ambulance business, a business appraisal from an industry-experienced intermediary can help you understand the fairness of the offer so you can make the best possible decision for you and your company. From speaking with a tax specialist about how a sudden sale could affect your tax obligation to discussing the possibility for early retirement with a financial advisor, being informed on all fronts will allow you to capitalize when the right opportunity presents itself.