Sell A Retail or Wholesale Company
Has the right time arrived for you to sell your retail or wholesale company? Joining forces with an experienced business sales specialist like KBS Corporate is advisable for anyone taking this step.
Our proven track record in selling retail and wholesale businesses will help you to establish the correct valuation for your company before utilising our extensive network of potential buyers to identify the most suitable acquirer.
We can help you with every aspect of selling your retail or wholesale company by establishing relationships with other key service providers in our wider Group, whilst delivering the outcome you are looking for with complete discretion applied throughout the process.
Sell A Retail or Wholesale Company
THE LANDSCAPE OF SELLING A RETAIL OR WHOLESALE COMPANY
A rising inflation rate in the UK reached its highest level for over three decades towards the end of 2022, while food price inflation specifically hit 16.9% and contributed to a fall in real household disposable income. Such scenarios typically result in consumers becoming more value-conscious and likely to make fewer discretionary purchases, thus impacting the profitability of retail businesses.
Consumer tastes and shopping habits have changed significantly in recent years, with rising environmental awareness triggering a greater demand for sustainable products. Discount stores have also continued to pursue rapid expansion plans, placing greater pressure on smaller retail business owners.
Online stores continue to be the biggest retail growth area, accelerated by the Covid-19 pandemic when physical stores selling non-essential goods were ordered to close under the stay-at-home ruling, and also due to consumers being satisfied by the range of products they can have delivered straight to their door by providers such as Amazon.
CHALLENGES WHEN SELLING A RETAIL OR WHOLESALE COMPANY
Debt: Eradicating debt from the business, for instance to suppliers, will help not only with the valuation potential acquirers are prepared to pay, but also to maximise the level of interest from prospective buyers.
Accounting: In addition to removing debt, the financial position of your retail or wholesale company needs to look as healthy as possible, so make sure you can identify and highlight reliable revenue streams which reflect an attractive opportunity.
Costs: Overheads such as business rates can be challenging for those selling a retail or wholesale company, while the price of utilities to heat and light premises has risen significantly in recent years and could be a factor in the level of interest.
Cybersecurity: Increasingly fewer consumers now pay with cash, so the security of your digital payment system must be as robust as possible to ensure data is protected – potential acquirers will need that assurance.
HOW TO SELL A RETAIL OR WHOLESALE COMPANY
1. Position yourself in the market
With supermarkets and discount stores trading in wide ranges of goods, an independent retailer is most likely to thrive when they specialise in a niche product or brand. This can build consumer loyalty by way of association with a certain product for which repeat custom is likely.
2. Conduct due diligence
This is something we can help facilitate and while the buyer of your business will carry out their own due diligence, you can too. This includes ensuring all key documents are up to date, for example employment contracts, licence certificates, ownership proof of assets and company formation documents.
3. Optimise inventory
Stock-taking will clarify what comprises the inventory of your business, but are all products effective? Some ranges of goods might be under-performing, in which case streamlining your offering will increase the appeal to prospective acquirers.
4. Improve metrics and KPIs
Knowing your most profitable sale lines and revenue KPIs is essential to displaying your retail or wholesale company in the best possible light. Increasing the figures for your average order value, conversion rate, year-over-year revenue and net profits will demonstrate the potential for continued growth.
5. Use the right tech
In an increasingly digitised world, customers often want to pay for goods and services with smartphone technology rather than cards and certainly instead of cash. Ensure their needs are catered for – and also that your CCTV system is an effective deterrent following rising levels of shoplifting amid the cost-of-living crisis.
6. Go digital
An e-commerce presence is key for any retail or wholesale company, allowing consumers to order goods for direct delivery or at the very least to be collected in store. A website generates greater online exposure for your brand and allows for custom beyond your immediate geographical area, and can be supplemented by email campaigns and social media posts.
7. Establish Heads of Terms agreement
With KBS as your adviser, this will be part of the service we provide. The agreement will draw together the results of negotiations between yourself and the buyer of your retail or wholesale company, setting out the final conditions of the deal that must be agreed upon by both parties.
8. Get a company valuation
We will also help to establish the correct valuation when you sell your retail or wholesale company, which is vital as you deserve to be rewarded for the time and effort you have put in but must not price yourself out of the market. Remember, the true valuation is only what an acquirer is prepared to pay.
9. Hire expert company sales advisers
For over 25 years we have been helping owners to sell their retail or wholesale business, as well as companies in many other sectors. We complete more business sales than any other adviser in the UK and we are ideally placed to source the buyer who will enable your objectives to be fulfilled. Contact us to find out more.
VALUING MY RETAIL OR WHOLESALE COMPANY
A number of factors come into play when we embark upon setting a suitable valuation for a company, including, of course, exactly what you are aiming to achieve. But there is much more to it than simply plucking a figure out of the air that would, for instance, enable you to enjoy a comfortable retirement.
For example, the EBITDA approach factors in Earnings Before Interest, Taxes, Depreciation and Amortisation to indicate the overall profitability of the company, adding common business expenses back in.
Another formula is SDE, which stands for Seller’s Discretionary Earnings, adding personal expenses back in that may have been reasonably incurred in the process of running the business, e.g. travel costs and your own salary.
HOW TO INCREASE THE VALUE OF A RETAIL OR WHOLESALE COMPANY
On a physical level, it may sound obvious but ensure your retail or wholesale company’s premises looks as appealing as possible to any prospective buyer who may drop in and cast their eye over it, potentially without your knowledge.
Flooring, windows and display facilities should be spotlessly clean and tidy at all times, while storage space must also be optimised when an acquirer makes a pre-arranged inspection.
Along with working to improve the metrics described previously on this page, and being able to present the rosiest possible financial picture, showcasing what the company has to offer and why it attracts customers will serve to enhance its valuation.
I was happy, it was an easy process and KBS handled it well,
I would recommend KBS Corporate to anyone who wants to explore a business sale and is seeking sound advice.
Tim Hogarth
Founder of Hogarth Antiques Ltd
“I was happy, it was an easy process and KBS handled it well. I would recommend KBS Corporate to anyone who wants to explore a business sale and is seeking sound advice.”
KBS Corporate has been a fantastic partner for us.
Within six months of the initial teaser, the deal completed and we are all thrilled with the outcome.
Ed Johnson
CEO of PushFar
“KBS Corporate has been a fantastic partner for us. From initial research through to deal completion, George Barnes (Associate Corporate Director), Aaron (McWilliams, Senior Research Analyst) and the entire team were dedicated, hard-working, thoughtful, considerate and found several parties interested in our business.
“Within six months of the initial teaser, the deal completed and we are all thrilled with the outcome.”
FINDING BUYERS WHEN PREPARING TO SELL A RETAIL oR WHOLESALE COMPANY
We have vast experience in completing all types of company sales, some of which are naturally worth exploring when it comes to selling a retail or wholesale business.
Trade buyers are the most likely acquirers, potentially those who are seeking to expand their geographical reach or perhaps to add new product ranges to their offering.
But retail and wholesale is also very much an option for alternative investments such as a Management Buy-Out or an Employee Ownership Trust where the people who work for you collaborate to take over your shareholding.
Our team of experts will consider every available avenue in the quest for you to exit your company with objectives fulfilled and the business in the right hands to enable it to grow.
WHAT INFORMATION DOES THE POTENTIAL RETAIL OR WHOLESALE BUYER NEED?
At KBS Corporate, we prepare marketing materials of the highest quality which portray your company to best effect, providing potential buyers with the important and accurate data that will enable them to make an educated decision about whether your business is the right fit for them and vice versa.
Among the key documents is a detailed Information Memorandum, which will be created by our experienced team of writers who ensure each example is unique and, with input from yourself, that it powerfully reflects the success and ethos of your company.
We will also produce a financial model or ‘forecast’ to illustrate why, based on future projections, your company represents an attractive investment opportunity over the coming years.
EXPERT SUPPORT SELLING YOUR RETAIL OR WHOLESALE COMPANY
When it comes to selling a retail or wholesale company, we have more than 25 years of experience in negotiating transactions and our team of experts has enabled us to become firmly established as the No 1 mid-market adviser in the UK.
An award-winning one-stop shop for every service you need to successfully sell your company, we provide a unique, tailored approach incorporating the latest data and cutting-edge technology which not only identifies the ideal buyer but guides you through every step of the process towards fulfilling your objectives.
Contact us on 0161 258 0118 for an initial no-obligation discussion in complete confidence to find out more about how to sell a retail or wholesale company and what we can do to achieve exactly what you are looking for.
SALES WE HAVE COMPLETED
IN THE RETAIL & WHOLESALE SECTOR
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