Before you reach out to a potential buyer of your stand-alone pawn shop or multi-store pawn business, there are several questions you need to be able to answer. Here are just a few of the most important ones:
- How long have you been in operation?
- How many people do you currently have on staff?
- Where are you located?
- What is unique or significant about your location?
- What are your milestones?
- What have you been able to accomplish and how did you accomplish it?
- What were your biggest struggles and how did you overcome them?
- If a new buyer were to take over, what things might the buyer have the ability do in the future to grow the business?
- Who are your biggest competitors and how does your business stack up against them?
If you don’t want to waste your time talking to potential buyers of your pawn shop that aren’t really serious, preparation is key. In addition to being able to answer the questions above, you need to have your financials in order and the ability to present them in a way that is attractive and makes sense to buyers. You also have to know the true value of your pawn shop.
Gathering the right financial data and determining the true value of a pawn shop are arguably the two most critical and difficult things any independent pawn broker must do in order to achieve the best possible selling price for their business. Unfortunately, because most pawn brokers enter into the selling/closing process without representation—or, without the right representation—they wind up providing multiple potential buyers with incomplete or unimpressive financial data and simply going with the buyer that presents the highest bid—without ever knowing how much their business is actually worth!
When you have the right exit strategy consultant on your side before you reach out to potential buyers, you can get all of the important questions answered ahead of time. On top of that, you can essentially put an end to old-school bidding wars that in today’s pawn market aren’t particularly beneficial or effective, and start working with the right potential buyer right out of the gate.
Looking for a complete sales preparation checklist? Click here.
Interested in a free pawn shop evaluation from a qualified Stallcup Group exit strategy specialist? Click here.
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