Expert Support Selling A Retail Business | KBS Corporate

Has the right time arrived for you to sell your retail business? Joining forces with an experienced business sales specialist like KBS Corporate is advisable for anyone taking this step.

Our proven track record in selling a retail business 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 business by establishing relationships with other key service providers in our wider Group and external partners, whilst delivering the outcome you are looking for with complete discretion applied throughout the process.

The landscape of selling a retail business

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 business

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 business 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 business, 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 business

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 business 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 business, allowing consumers to order goods for home 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 business, setting out the final conditions of the deal that must be agreed upon by both parties.

8 Get a business valuation

We will also help to establish the correct valuation when you sell your retail business, 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 business sales advisers

For over 25 years we have been helping owners to sell their retail 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 business

A number of factors come into play when we embark upon setting a suitable valuation for a business, 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 business, 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 business before selling

On a physical level, it may sound obvious but ensure your retail business 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 business has to offer and why it attracts customers will serve to enhance its valuation.

Finding buyers when preparing to sell a retail business

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 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 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 buyer need?

At KBS Corporate, we prepare marketing materials of the highest quality which portray your business to best effect, providing potential buyers with the important and accurate data that will enable them to make an educated decision about whether your company 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 business represents an attractive investment opportunity over the coming years.

Finding buyers when preparing to sell a retail business

When it comes to selling a retail business, 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 business and what we can do to achieve exactly what you are looking for.

Recent Business Sales In The Retail Sector

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Completed Sale

Reading Commercial Spares Ltd

KBS Corporate’s Oliver Rigby has overseen the sale of Reading Commercial Spares to vehicle parts retail group Picksons.

Reading Commercial Spares was founded in 2004, supplying truck and trailer parts to commercial businesses throughout its region. The three shareholders – Mike Keirle, Steve Thatcher and Joanne Thatcher – offered the company for sale as part of their retirement plans.

The opportunity attracted strong interest and an offer was accepted from Picksons, an independent, family-run business which began trading in 1979.

Picksons has six branches selling truck, trailer and bus spare parts and accessories in the Midlands and South West of England and, via its subsidiary Fleetwheel, five in South Wales.

By adding Reading Commercial Spares to its portfolio, Picksons will further strengthen its presence along the M4 and M5 corridors.

“The shareholders of Reading Commercial Spares wanted to facilitate their retirement plans and were ready to take a step back,” explained Oliver Rigby, KBS Corporate Deal Executive.

“Mike and Steve are to remain as employees but the sale to Picksons reduced their workload.

“I’m extremely satisfied to have completed this deal.”

Oliver praised the roles played by KBS Corporate colleagues Connor Gregory-Dorsey and Jamal Forbes, Corporate Finance Analysts, in securing the sale of Reading Commercial Spares.

acquired by

Reading Commercial Spares Ltd
Sector: Retail
Location: Berkshire
Buyer: Picksons

 

Ready to talk about your business requirements?

Give us a call on
+44 (0) 161 258 0118 or contact us now to get started.

Completed Sale
acquired by
Reading Commercial Spares Ltd

Sector: Retail
Location: Berkshire
Buyer: Picksons

X
Completed Sale

Solmar Villas Ltd

Solmar Villas has been acquired by Kuoni parent Der Touristik UK, a buyer introduced by Andrew Dodd, KBS Corporate Director.

A family-run business based in Burton-upon-Trent, Staffordshire, and founded almost 30 years ago by John and Maria Tayler, Solmar Villas joins Der Touristik UK’s expanding range of specialist brands which includes Carrier, CV Villas, Kirker, Jules Verne and Journey Latin America in addition to Kuoni.

With a portfolio of over 2,000 holiday villas across more than 30 destinations in Spain, Portugal, Cyprus, Greece, France, Turkey, Italy, Croatia and the US, Solmar’s offering has a broad price range which will be sold through Kuoni’s 27 UK stores, while the company will continue to work with independent travel agencies nationwide.

Julie Blake, daughter of John and Maria Tayler, will stay as managing director and report to Francis Torrilla, UK chief executive at Der Touristik.

The business, which has partnerships with Jet2 Holidays, British Airways and Hays Travel, is remaining at its Burton-upon-Trent headquarters and staff have been told there are plans to grow the company and increase the 97-strong workforce.

“The success of Solmar Villas has been driven by a team with a united aim of providing high-quality villas combined with excellent customer service,” said Julie Blake.

“Our strength is the relationships we have with our villa owners, suppliers, employees and clients and this will continue to be the driving motivation behind us.

“I’m very proud of the business my family started and I’m equally thrilled to work with Francis and the wider team at Der Touristik to drive awareness and growth of this amazing brand. We have ambitious plans and with the support of the group, I’m excited to be part of Solmar’s next steps.”

Der Touristik said it aimed to turn Solmar Villas into the leader in the villa market and described the acquisition as “a good fit” for its business, sitting well alongside its existing upmarket villa specialist CV Villas, which is particularly strong in the Greek holiday sector.

Francis Torrilla said: “Solmar Villas has seen phenomenal success with a real drive for growth and quality. The acquisition enhances and complements our existing portfolio of independently managed businesses, enabling us to drive substantial growth in the villa market.

“It also means we have a broader range of price points across our specialist brands so we are relevant to more customers whilst always focusing on value and quality.

“We can bring investment opportunities to continue to grow Solmar Villas into the market-leading villa provider and further develop its range and distribution.

“We have a positive message to share with our staff, suppliers, travel agents and customers in that we will protect the business ethos and values which have made it so successful and invest in Solmar with the ambition to grow it into the largest villa operator out of the UK.

“I look forward to working with Julie as we expand the business and grow our offering in both the UK and overseas.”

KBS Corporate’s Andrew Dodd added: “I’d like to wish both parties all the very best and lots of success in the future.”

acquired by

Solmar Villas Ltd
Sector: Leisure
Location: Staffordshire
Buyer: Der Touristik

 

Ready to talk about your business requirements?

Give us a call on
+44 (0) 161 258 0118 or contact us now to get started.

Completed Sale
acquired by
Solmar Villas Ltd

Sector: Leisure
Location: Staffordshire
Buyer: Der Touristik

X
Completed Sale

Greengates Builders Merchants Ltd

A family-owned independent builders merchants has been sold to Haldane Fisher in a deal overseen by Jay Singh, KBS Corporate Finance Director.

Greengates Builders Merchants, located in Accrington, has been trading from its site in Lancashire since 1987 and has grown to employ 18 people from the surrounding area, running three crane offload wagons.

Supplying building and timber materials to trade and DIY customers, Greengates was a natural fit for Northern Ireland-based Haldane Fisher, a builders and plumbers merchants which is expanding its presence in northern England.

Steven Pickup, Managing Director of Greengates, was seeking to retire and instructed KBS to orchestrate a sale – for which Richard Stocks, Senior Research Analyst, quickly saw considerable potential.

“Given the recent consolidation within the builders merchant sector and the strong regional presence Greengates has, we generated significant trade interest in the opportunity,” said Richard.

“This came from companies that already have a North West presence and parties looking to move into the region.

“This has become a market where the scope to expand with the opening of new sites has become more limited, and high-quality independent merchants, such as Greengates, will continue to command strong interest from parties looking to expand their footprint.”

Following a healthy level of interest in the opportunity, Haldane Fisher was identified as the ideal acquirer and Jay Singh presided over a sale that suited both parties particularly well.

“Greengates was a perfect strategic fit for Haldane Fisher, both in terms of product offering and also in terms of location,” said Jay.

“Steven has built up an excellent business with a reputation for holding good stock levels and delivering on time.

“The transaction allows Haldane Fisher to continue with their growth plans and for the shareholder to start their exit journey.”

Steven Pickup is to remain involved with the business for a period post-completion to help with the handover.

“It was a pleasure to advise the shareholders and bring the transaction to a successful conclusion,” added Jay Singh.

acquired by

Greengates Builders Merchants Ltd
Sector: Building Supplies
Location: Lancashire
Buyer: Haldane Fisher

 

Ready to talk about your business requirements?

Give us a call on
+44 (0) 161 258 0118 or contact us now to get started.

Completed Sale
acquired by
Greengates Builders Merchants Ltd

Sector: Building Supplies
Location: Lancashire
Buyer: Haldane Fisher

Speak to our expert team on 0161 258 0118 to arrange a consultation

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