We all know someone who waited until the last minute to get a service they needed: car insurance, that warrantee on their largest appliance, or a list of valuable items they would like insured in their home. And what did they wait for? A car crash, a fridge malfunction, or a flood. Well, we feel the same way about your dealership evaluation. The time to have it conducted is when things are going smoothly — we believe that there is no need to wait until an interested buyer knocks on your door (or your literal roof caving in) to know your business’ worth. So, let’s go through this question together: Why now? Your Dealership’s Biography Having a true thousand-mile view of your dealership’s financial health and capability can act as a dashboard for your business, help you know where you are now, and more importantly, where you are going (or can go). From the value of the brick & mortar to the KPIs that make up your dealership’s bottom line. A true deep dive under the hood allows you to diagnose areas that you may want to pivot (or preserve) to reach your business’s fullest potential. Waiting for your next 20 Group to know where you need to improve no longer needs to be the norm. Imagine a dedicated evaluation report with all the metrics to help you make informed decisions for the future with complete confidentiality. We’re living in an era where you can assess the health of your vehicle with a few touches on your infotainment system; assessing your dealership’s financial health can be just as efficient. No Surprises Assessing your business regularly is a lot like having your car serviced: no one wants unpleasant and costly surprises. A dealership evaluation is a preventive exercise that allows you to analyze areas of improvement and the good practices of your dealership. It’s an exercise that highlights performance but also areas where your business can do better. This in-depth analysis of your dealership’s activities also allows you to detect business trends that you may want to pursue or improve, especially if you feel shortchanged by your fiscal year (we know you’re thinking of your tax return as you read this). In short, this one- to twoweek exercise will allow you to take stock of your business from every angle. Be Better Equipped for Short, Medium, and LongTerm Planning Are you thinking of expanding your portfolio or maybe retiring? No matter what stage of your professional life you are in, an annual business valuation is an indispensable tool for clear and precise planning of your business activities. Anthony Codispoti, DSMA Manager of Valuations, notes that among the thousands of appraisals that have been performed over the past decade, there have indeed been several instances in which results showed a 2030% difference in value from what a dealer thought their dealership was worth. Such a difference, whether higher or lower than expected, can paint a clearer picture of what your fiscal future will look like. So, whether you are creating a succession plan for the next generation or seriously thinking of business growth, both projects could be greatly enhanced with a little preparation — and additional information. Don’t Underestimate the Power of a Balance Sheet Thanks to the rising inflation rates, a clear and precise balance sheet of your business is crucial when negotiating. Indeed, dealership transactions can be quite complex, and the current economic climate (inflation, brink of recession, etc.) unfortunately further complicates negotiations. This is why a dealer in expansion mode should know their business inside and out. A balance sheet is your best asset Why Wait? How Evaluating Your Dealership Can Help Your Business By Maxime Theoret, CPA and Managing Partner & Jennifer Rafael, Vice President and Partner at DSMA 14 Illinois Automobile Dealer News
RkJQdWJsaXNoZXIy MTg3NDExNQ==