Whether you’re planning to sell your courier business in a few months or a few years, the numbers are on your side: annual growth of 2.5% is projected by IBISWorld, with total revenues reaching $4.8 billion by 2021.
Some 85% of Australian businesses send parcels regularly, with 78% sending 10 parcels or more a month, and the inexorable growth of online shopping assures strong growth in retail delivery.
So long as you can enhance and showcase your business’s strengths and potential, you can be confident of finding a buyer and achieving a decent return on your years of hard work.
Preparation takes time
But this all takes time.
The best time to plan your exit strategy, arguably, is right after you’ve bought a courier business. Decide on your end goal at the outset – whether that’s a comfortable retirement within 10 years or securing an injection of private equity capital, while staying on the board, in five – and you can chart a course towards achieving it immediately.
Whatever your circumstances, there are a few steps to take to make the business of selling much easier.
The value of professionals
Professional help, whether from brokers, solicitors or accountants, goes a long way to achieving a smooth sale at a good price. The bigger and more profitable your business, the bigger the team you might need – and be able to afford.
An experienced broker can evaluate your business more accurately – and dispassionately – than you ever could. Value isn’t just about asset values and profits – although those or the principal factors; it’s also about reputation for reliability, among other factors.
Appoint a broker and/or valuation expert certified with the Australian Institute of Business Brokers for reassurance that they’ve complied with membership criteria around:
- Skill, diligence and care
- Conflicts of interest
- And objectivity and independence
Put the word out (quietly)
Loyal customers will be suspicious of any change of management so market the sale more discreetly than you would with
Ways to find buyers include:
- Through business brokers or real estate agents
- From within your business
- Through your network of business contacts
- By advertising in the local newspaper or in trade publications
- Listing your business on this website, which gives you exposure to far more prospective buyers than any other medium
Prepare for due diligence
Your buyer will want to visit your premises during due diligence.
If the sales process is sometimes complex and fraught, there are a few quick and simple jobs that can make a real difference
Are your assets presentable and in good working order? This includes premises if they’re part of the package.
Do your vehicles need servicing and are they clean and well presented? First impressions count so a repaint, perhaps updating branding, can make a real difference to a buyer’s perception.
Be friendly, courteous and accommodating when buyers visit the premises. And make sure your staff – if you have any – are too.
You want the buyer to see a well-oiled machine working smoothly, with a positive atmosphere and diligent employees.
The buyer will want reassurance that they’re buying more than just a business name, a van and some business cards – and more than just verbal reassurance.
So organise your paperwork – including tax documents, profit and loss accounts (last 3-5 years), customer and staff contracts, vehicle registration documents and service histories – so it’s readily accessible and in order.
If you’ve left yourself plenty of time to prepare for the sale, there might be more substantial changes that can improve the appeal and valuation of your business.
Systems and processes
Beyond checking the condition of your fleet of vans, a credible buyer will also want to see how your business processes and IT systems work. Put yourself in their shoes: Are your systems easy to grasp and learn for the uninitiated?
Is your software effective in allocating jobs to, tracking and rerouting drivers according to myriad factors like traffic, delivery priorities and drivers calling in sick and so on?
Are you successful because of your systems and processes or despite them?
If it’s the latter, then you’ll have a hard time convincing the buyer that they can emulate your success.
Fortunately, overhauling your systems might be simpler than you thought. There are plenty of off-the-shelf online tools for couriers.
For instance, Zoom2U connects couriers with delivery jobs.
And Premonition uses machine learning to optimise routes based on traffic, weather, delivery windows, incoming orders and returns, truck capacity, a driver’s final destination and consumer requests.
Here are more tips on improving the performance of your courier business.
You can further reassure the seller about the transition to new ownership by offering to stay on in a consultative capacity for a specific period post-sale.
The perfect transition is where you hand over the business in such a way that no one – neither customers nor employees – will notice any disruption to normal service.
It might not be easy to sell your business, practically or emotionally, so it pays to be prepared and enlist the help of a solicitor, accountant, and/or business broker.