Buyers and Sellers Meet |
There are many good reasons for acquiring a staffing business. According to information we have gathered over the years, many buyers seek the opportunity to share your customer relationships, increase their service offerings, expand their geographic footprint, increase their market share, increase profits, and obtain greater economies of scale while lowering their unit processing costs. All are valid motivators and strong drivers for acquirers.
There are many good reasons for acquiring a staffing business. According to staffing industry information we have gathered over the years, many buyers seek the opportunity to share your customer relationships, increase their service offerings, expand their geographic footprint, increase their market share, increase profits, and obtain greater economies of scale while lowering their unit processing costs. All are valid motivators and strong drivers for acquirers.
Those are the general reasons. What are the specific reasons they will find your business more appealing than another staffing business?
Operating in a specialized area of staffing and generating above average year over year growth, higher than usual gross margins and higher profitability than your industry sector typically generates are all very attractive and very positive attributes that will most likely help you earn better than average offers for your business.
However, it may surprise some to learn that what Buyers are really willing to pay for is often tied to how safe and secure they perceive their proposed investment to be and how likely is it to deliver a reasonable and consistent return on their invested resources.
The particular order of the following elements and how each is measured may vary from Buyer to Buyer (that is they are Buyer specific) however most Buyers will be seeking in some order of priority:
· Reasonably Predictable and Consistent Earnings;
· A Strong Team behind the Owners, tied into future Performance;
· A Diverse and Growing Customer Base;
· Desirable and Growing Market;
· Solid Systems and Infrastructure;
· Stable and Growing Customer Relationships;
· Strong and Positive Market Presence;
· Strong, sector-specific Gross Margins;
· Strong, Upside Growth Potential;
· Strong Ethical Standards;
· Low Staff and Customer Turnover;
· Clean Record-Keeping.
Contact Sam or Bob, who have successfully completed over 120 staffing industry transactions, if you'd like to discuss M & A matters related to your staffing firm.
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