How to Sell a Bicycle Business
According to the National Bicycle Dealer's Association (NBDA), the bicycle industry has been falling because of high expectations of current customers and a low profit margin relative to the higher start-up capital. The industry lost about 1,000 bicycle retailers in 2009; and because of this loss rate, you may find it difficult to sell your bicycle business without proper planning. At the same time, cycling ranked fifth on the 2008 list of most popular outdoor recreational activities---an indicator of a good market out there that you can reach with a solid marketing plan.
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Instructions
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Identify the right time and the right reason to sell your bicycle business. Since most business owners sell their company as a result of losses, the buyer will likely want to verify your financial statements. Advertise to sell when the business has a good client base and financial record. You can negotiate a higher selling price if the business is doing well.
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List all the assets of your business to determine exactly what you are selling---the bicycles alone, the inventory of bicycle parts alone or the whole warehouse where you store the bicycles. You will indirectly sell goodwill, trademarks and your client base.
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Identify a good approach to determine the worth of your business. Base your approach on factors such as a projection of your potential profit for the future, the amount of cash the business generates on a monthly basis and the number of assets such as bike parts and inventory you have. If necessary, hire professionals to valuate your business based on market values.
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Put your bicycle business in complete order. Clear off your debts, if any. Update your business records. Settle any lawsuits, if any. Pay off all taxes due. Keep your premises clean, and repair any damaged items.
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Advertise in local newspapers, TV and radio stations that you are selling your bicycle business. You can also sell your business online by publishing the advertisement in websites meant especially for your state and locality or business type. Join relevant associations, and place advertisements in association newsletters.
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Tips & Warnings
Use your negotiating and communication skills in a proper manner so the buyer gets an attractive view of your business. List all the possible questions a buyer can ask, and come up with good answers for each.
Price your business carefully---too high will make it tough to sell, and too low will cause you to lose some profit.
References
Resources
- Photo Credit bicycle shop image by Alexander Ivanov from Fotolia.com
