While there are certainly aspects of selling your transportation business that are unique to the industry, marketing your business is also similar to marketing services and products: A seller’s success often depends on the specific advertising strategy and its appeal to the target demographic. In order to develop a successful marketing plan, you need to start by identifying and targeting your ideal buyer. Once you’ve performed those two key actions, you’ll be able to package your sale in a way that will be attractive to the buyer of choice.
Step 1: Identify Your Buyer
As you attempt to identify the best buyer for your particular transportation business, you need to keep in mind that there are two basic types of buyers: strategic and financial. Strategic buyers are those with a long-range plan and vision for how the business will help them meet their long-range financial and business goals. These types of buyers may be willing to pay more than others in order to merge with your existing business or buy it out, entirely, as part of a strategic business plan.
By contrast, financial buyers are more concerned with your company’s ability to be financially rewarding and benefit their financial portfolios at the outset of the acquisition. A financial buyer may be new to the transportation industry, altogether, while a strategic buyer typically has other related businesses as well as connections and contacts within the industry.
Step 2: Target Your Buyer
Once you’ve determined whether a financial buyer or a strategic buyer is best-suited to your selling strategy, you can discuss a customized sale package with an industry-specific transaction adviser, such as our clients, the Tenney Group. In that package, you’ll want to highlight the aspects of your business that will appeal most to the type of investor that you’ve chosen to target. For instance, financial buyers will be most concerned with documentation of your business’s growth profits. While a strategic buyer is certainly not unconcerned with the financial details, it will be more interested in how acquiring your transportation business will be able to benefit their current holdings.
By emphasizing the information that will matter most to your ideal buyer, you’ll be able to develop an attention-getting package that will catch a buyer’s eye. While you want to leave out unnecessary details, you also want to be prepared to be flexible, tailoring your proposal to the needs of your target buyer. For instance, a financial buyer might require seller financing for assurance, or a strategic buyer might not want all the vehicles in your fleet. By being open to negotiations, you’ll be in a better place to keep the interest of your ideal buyer and do what you aim to do—close the deal promptly.
Once you’ve identified and targeted a specific buyer type, you’ll want to talk with an intermediary from the transportation business broker firm who has experience in the transportation business. Such a resource will help you achieve the best price possible by connecting you with an impressive number of potential buyers within your target group.