Who Can You Sell Your Answering Service To?
November 4, 2016
If you’re thinking about selling your answering service you will first want to optimize your business for sale. This will help you obtain a top selling price. Another step, that many business owners neglect, is strategizing options for who to sell to. Overlooking some of these prospective sales opportunities may result in ignoring financially or emotionally rewarding possibilities.
When it comes time to sell, look at each of these groups for potential buyers.
Local Competitors: Selling to an answering service in your area is attractive proposition to the buyer. Your proximity to their operation makes for an easier transition and is an ideal situation to achieve economies of scale by merging the two operations together. Because of this, the local buyer may be willing to pay you more than any of the other types of buyers. Selling locally is also a scenario that allows the potential for many of your valued employees to retain their job.
Industry Player: Aside from selling to a local competitor, everyone in the industry is a potential buyer. While they may opt to keep your answering service as a stand-alone operation, the more likely scenario is to merge it with one of their other operations. Though this was once a cost-prohibitive consideration, today’s internet and telephony offerings make this a realistic option. On the plus side, you will enjoy a larger pool of buyers, who will possibly drive the sale price up. On the negative side, if the buyer moves your accounts to another answering service, most all of your staff will lose their jobs.
External Investor: Entrepreneurs and businesses from other industries currently see the telephone answering service industry as an attractive business to own. They come to the bargaining table with broad business skills and likely strong financing. However, their lack of specific knowledge about the industry could cause them to make some fundamental errors in negotiating the transaction, handling the transition, and conducting operations, which is a huge concern if seller financing is involved.
Staff: Most every answering service has one or more key staff who have the desire and ability to buy your answering service. They will be well positioned to make for a smooth transition and continue to operate the legacy you have built over years of hard work. This is a great way to reward loyal employees and protect your staff. The downside is that the deal may take longer to consummate and the selling price may not be as high.
Family: The dream of some answering service owners is to pass on their business to their children or relatives. For others, this is the last thing they want to do. When selling to family there are two key considerations. First, will you sell at market value or offer a special deal? Second, is the family member truly ready to run the business? Ideally he or she should have a business degree, successful experience outside the industry, and familiarity with your operation. Selling to your children continues your legacy, but this must be balanced with the knowledge that the failure rate of second-generation run family businesses is quite high.
Consider all five of these categories of potential buyers when you are ready to sell, you’ll be glad you did.
Janet Livingston is the president of Call Center Sales Pro, a premier sales and marketing service provider and consultancy for the call center and telephone answering service industry. Contact Janet at firstname.lastname@example.org or 800-901-7706 to arrange a private consultation about buying or selling an answering service.
Peter Lyle DeHaan is a freelance writer from Southwest Michigan.
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