Selling a transportation business can lead to great profit for sellers and buyers. Ideally, a business sale will allow the seller to walk away with the profit while the buyer sets about reaping the benefits of a new investment. However, the days of lump sum cash payments are disappearing. These transactions still exist but they are no longer in the best majority interest of both parties. Everything hinges on responsibility. Lump sums take stress off the seller and needlessly burden the buyer. Financing is a way for the buyer to hold the seller accountable even after the sale is complete.
Fluctuating terms based on whether a buyer will present a lump sum or financing options is reason for questions and possibly transaction termination. Offering a significantly lowered price for cash informs the buyer of any fears the seller may hold. The business may be in a tenuous situation, teetering on foreclosure or other hidden defects. Allowing for financing shows seller confidence in the business.
Financing lowers the risk factor for the buyer and raises it for the seller. Negotiating how much risk is a balancing act. Ideally, the seller and buyer should shoulder comparable risk with financing. A cash deal upsets that balance in the sellers favor, causing some buyers to shy away from the deal on principle. Financing will reaffirm seller confidence in the buyer while also keep accountability a factor in the sale.
Research is key to any lucrative sale. The seller should have a transport business valuation available to the buyer. A truthful seller can buoy any research the buyer has done previous. Both seller and buyer should be aware of the market outlook for the business. This knowledge will help decide whether a cash sale or financing is best.
The Tenney group is here to facilitate the responsibility on both buyer and seller accounts. They are a company experienced in transportation business sale and their opinion on cash or financing will help accelerate the sell towards a lucrative end.
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