Top 3 Things that Define a Successful Sale
A recent survey of former funeral home owners identify what they considered when selling.
NewBridge recently surveyed a group of former funeral home owners who have sold their businesses in the last five years. Our intent was to gain insight into what former owners felt were the most important variables in their decision to sell and which buyer to select. While the reasons each owner decided to sell varied, the survey results found similarities in what they believed constituted a successful sale.
Here are the top three objectives that former owners stated were most important to them in their decision to sell:
3. Having an experienced advisor walk them through the process.
Having personal accountants and attorneys to assist from the background is important. Still, former owners stated that having a consultant familiar with the industry, with the buyers, financing, and valuation multiples was extremely important in making them comfortable that the process was being led professionally.
NewBridge’s more than two decades of experience assisting funeral home sellers and buyers is unparalleled in the industry. Our staff of CPAs, lawyers, MBAs, and former funeral home owners and directors has a combined experience of assisting in the sale of more than 1,000 funeral homes. Additionally, NewBridge specializes in ownership transfers – we do not get involved in offering accounting or other services to independent funeral home owners. Selling your funeral home usually only happens once, and we believe we owe you our undivided attention.
2. Confidence the financial structure of the transaction was favorable.
Not surprisingly, owners stated that “knowing [they] were receiving a fair valuation and structured in a way to pay the least amount of taxes as possible” was important. In addition, having someone experienced in explaining the valuation process and even providing market data on other sales multiples or structures was important to owners. Many owners had specific goals they wanted accomplished, which were added to the structure of the sale.
As part of our process, NewBridge first gathers information to understand both the current profitability and the possible hidden potential of the business – this helps us determine the valuation range an owner can expect. We then talk with the owner to include points that they believe are unique that should be included in the structure. And finally, when an offer is made, we can work with the owner’s CPA to determine how best to structure the transaction so the lowest amount of taxes will be due.
And finally, the top factor that selling owners believed was important in their decision to sell was:
1. Assurance buyer would protect their legacy.
Funeral home owners understandably worry that a buyer will come in, raise prices, and reduce services. In contrast to many corporations that are buying funeral homes, the buyers that NewBridge works with collaborate with the seller to maintain or increase services. These buyers have found that this approach has allowed them to continue to build and maintain relationships already established within the community. Whether it is after-care programs, increased marketing, or facility renovations, NewBridge buyers know that serving families is what ensures the success of a local funeral home. In addition, it is common practice for our buyers to gladly connect you with former owners and managers to get a first-hand account of how the business operates after the sale with a new owner.
Unlike other succession planning companies, NewBridge provides services at no cost to the seller. We have built relationships with many strong, private buyers responsible for any transaction costs.
In our twenty years of service, NewBridge Group has worked closely with funeral homes across the country to customize succession plans that advance professional and personal goals. Whether you are ready to sell, on the fence, or simply curious, we would love to hear about your daily challenges and long-term dreams. To take the next step and receive your complimentary valuation, click here.