Succeeding in the Midwest’s Hot Buy-Sell Market № 3 When it comes to the dealership buy-sell market, America’s heartland is truly at the center of the action. Whether you’re one of the growing numbers of Midwest-based dealers ready for retirement or an aspiring dealer looking to enter the market for a growth opportunity, interest is peaking in the Midwest’s thriving potential for buy-sell opportunities. The Midwest has some of the country’s strongest returns on investment and a large population of independent rooftops positioned for acquisition. But with this spotlight on the region, the market is poised to become a delicate environment for a dealer looking to buy or sell. Whether you are buying or selling, there are five key themes that should be kept in mind to ensure a smooth and positive experience. 1. Planning, Not Reacting: Engage early with a mergers and acquisitions (M&A) partner to strategically seek out the best acquisition opportunities. Even if you’re not ready to make a move tomorrow, it is wise to engage sooner rather than later. That way, you can take the time you need to prepare, learn what to expect, and ultimately be in a more secure position when it comes time to make a move. You will thank yourself later for taking some of the pressure off earlier and by starting on your own timeline, instead of on someone else’s. 2. Quality, Not Quantity: By working proactively, you create time to focus on strong opportunities with great potential, not just what is available at the moment. Not all buyers — or sellers, for that matter — are created equal. A dozen opportunities mean nothing if those opportunities aren’t strong ones. Whether you’re looking to exit or to grow, it’s important not to lose sight of your strategic goals. 3.The Right Fit, Not Any Fit: From either side of the equation, it’s crucial to prioritize finding the right match, both as a buyer and as a seller. When seeking a successor, keep in mind that you’re not only looking for someone who will honor the legacy you’ve built but also someone looking for strategic growth opportunities, not just to grow for the sake of adding rooftops to their list. 4.Collaborators, Not Rivals: A buy-sell scenario is certainly a delicate environment, which is why the chemistry between the parties is so important. For each transaction, everyone should come out of the deal feeling positive about their experience; that is why having a trusted M&A partner is essential. As a business owner, it isn’t every day that you’re buying or selling a company, so it’s only understandable that the situation can sometimes feel overwhelming. At the end of the day, all most buyers want is to grow and evolve with the business the seller has started, and all most sellers want is to find someone who values their legacy as much as they do. 5. Big Picture, Not Tunnel Vision: Working with an experienced M&A broker matters. They can evaluate buy-sell opportunities at a holistic level, not just from the limited viewpoint of a standard automotive broker. Your M&A broker should be a true strategic partner, not just another vendor who comes to check a box, cash a check and leave. Buying or selling a dealership or group is a major decision, so choosing your M&A partner carefully is important. At DSMA, our end-to-end capabilities, including our best-in-class valuations, allow us to dig into the finer details of an opportunity to help buyers and sellers both be confident in an opportunity. We can help you achieve your goal to make an exit or expand your business while helping to ensure a fair deal and positive experience for everyone involved. Jennifer Rafael, Vice President and Partner of Midwest Operations for DSMA, recently oversaw an acquisition in her hometown market of Chicago that she says offers valuable takeaways for dealer principals considering buying or selling in the Midwest. Under Rafael’s guidance, family-owned Pugi Auto Group of Chicago suburb Downers Grove, Ill., found its new family in locally trusted Castle Automotive Group. “I consider it a privilege to be trusted by dealers during what can sometimes be a delicate process, and nothing matters more to me than honoring that trust,” Rafael said. “The business we’re in is a highly personal space, so working with a partner who respects the emotional factors at play and facilitating the right deal chemistry is crucial. At DSMA, we like to say that your business is no one’s business but your own.” With 20 years of automotive experience, including multiple senior management roles in finance, Rafael is an industry expert in dealership mergers and acquisitions. As a Partner at DSMA, she leads the firm’s expansion into the growing Midwest dealership market. She holds a BA and an MBA in Business and Finance. She can be reached at Jennifer.rafael@dsma.com. « To read more about the acquisition, please scan the QR code. https://dsma.ca/dsma-fall-newsletternovember-2023-edition/ 10 CATA UP TO SPEED
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