When pawn shop owners talk to Stallcup Group about the value of their businesses, in addition to talking about their assets, they inevitably wind up talking about how much they value their businesses on a personal level. We hear stories about how pawn shops were passed down from family members, about how by making various business choices, they positively impacted their communities, and about how they’ve served the same customers for several years and know many of them by name. They talk about their most valued employees, and how it will be strange or bittersweet to no longer see them on a regular basis.
As an independent pawn business owner, you’ve invested more than time and money in your business; you’ve invested your blood, sweat, and tears in building your business into something in which you can rightfully take pride.
There are a lot of reasons to sell your pawn business rather than simply close it. One big reason to sell rather than close is the current seller’s market (thanks to the race the major pawn companies are in to outdo each other by buying up more of the market). But perhaps the biggest reason you should sell rather than simply close down is that if you find the right buyer, whether that buyer is someone you know, such as your current manager or family member, or whether it’s one of the major pawn companies, is that if you find the right buyer, some of the things you value about your business and its legacy in your community don’t have to disappear along with your pawn shop’s brand.
Obviously, if you sell your pawn business to someone you know rather to one of the major pawn companies, you have a greater chance of seeing the new owners run your business in much the same way you’ve been running it. But even if you sell your business to a major pawn company, you can build certain assurances into your selling agreement that will enable some of the things that are important to you, personally and professionally, to be carried out once your business is out of your hands. The selling price is important, of course, but what else is important to you? Do you have certain partnerships that you want to see remain intact? Do you want your current employees to be given the opportunity to apply for positions within the new business before the buyer advertises job openings publicly?
To build certain assurances into your selling agreement, you need solid representation that understands what is important to you, what is important to the buyer, and can negotiate terms using solid financial data and analytics that can be used as bargaining chips to achieve not only the highest possible selling price, but the other concessions and terms that are important to you. Trusted exit strategy specialists can also help you understand what is achievable so that you enter into negotiations with a clear idea of what it is you’re asking for and what it is you may actually be able to achieve.
There are definite benefits to be gained by selling to a major pawn company. When you sell to someone you know, the finance agreements tend to be longer, which means your immediate payoff is less. A large immediate payoff can not only help you move quickly into the next phase of your life or career, but help you to do things like give valued employees generous severance packages.
Whatever your decisions for dissolving your independent pawn business, the one thing you should be one hundred percent clear on is that closing your business is almost never the best option. Why close when you can sell your pawn shop, especially when you can sell responsibly to a buyer that you can trust to continue to operate in a way that you can feel good about?
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