Selling a Pest Control Company

Most Owners Take the Lazy Way Out — and it Costs Them

Many pest control operators take a very passive approach to selling their businesses and consequently leave substantial money on the table.

Instead of planning for their exit years in advance and instituting a formal, competitive sale process, they wait until they must retire and take the best offer from the first acquirer that shows up at the door.  In other words, they finally answer that phone call from the random acquirer looking to buy, and then only deal with that acquirer throughout the rest of the process, all the while fooling themselves into believing that no one else could possibly pay any more.

In a consolidating industry like pest control, there is one certainty that plays out day after day, week after week, month after month – the amateur versus the professional – the experienced corporate buyer sitting on the other side of the negotiating table from the first-time seller. The extreme majority of pest control operators sell a business once in their lifetime, while corporate development officers at acquirers have been doing it for decades, sometimes two dozen times per year.  By understanding and implementing a carefully planned process, the seller can significantly shift the odds in his or her favor and achieve substantially better results than a passive, privately negotiated sale.

Sell the Smart Way

Most owners believe that the investment bankers, M&A advisors and business brokers earn their fee by finding a buyer. The truth is, that is only a very small portion of what a skilled and experienced advisor will do. Finding the buyer is the easy part, positioning the seller in a competitive process so that acquirers are forced to simultaneously bid for the right to acquire the target company is what takes skill and finesse.

Potomac’s sell-side advisory is unique in the pest control industry and our clients are certain that the day they go to the closing table, they have extracted the absolute highest price possible for their company.

How Potomac’s Clients Get Premium Service and Unmatched Results

    1. Preliminary Analysis and Advisory – When you engage Potomac to sell your pest control company, we begin by performing a preliminary valuation and operational analysis. You benefit by having the only team of accredited and certified valuation analysts in the pest control industry pour through your company’s operational and financial information in order to determine a preliminary valuation range as well as determine what, if anything, needs to be done prior to a sale.In about fifty percent of our sell-side engagements, we uncover significant issues that may impact the pricing of the business upon a sale. This allows our clients the opportunity to discover and correct financial and operational issues before going out to market — it’s better that we find them than an acquirer.

    2. The Confidential Information Memo – Prior to taking your firm to market, we prepare a thirty to forty page document called the “Offering Memo,” “Confidential Information Memo,” or “the Book.” This is the primary selling document and highlights the key investment considerations of your business. The quality of our offering memos are unmatched in the industry.

      We are always extremely impressed with Potomac’s offering packages, they are always among the best we see— Director of Acquisitions, Orkin

    3. The Sell-Side Process – Selling a business is very different than selling any other asset. Unfortunately, most business brokers and M&A consultants in the pest control industry, treat it as just that, an ordinary asset. Which is a serious problem – for the seller. Keep in mind, each business has a unique value to each and every acquirer. For the owner, the way to extract the absolute highest price for a business is cause acquirers to bid simultaneously in a confidential process, while remaining emotionally detached from the process. That’s exactly what we do for our clients. After executing the appropriate confidentiality and non-solicitation agreements, we provide the Offering Memo – the best in the industry — to a variety of appropriate acquirers and ask them to submit bids (also known as indications of interest, terms sheets or letters of intent to purchase) while shielding our clients from having to negotiate directly with acquirers on what is often the most significant transaction of their lives. Unfortunately, for those owners who engage business brokers, often former pest control operators themselves who have neither years of experience nor formal training in M&A, they end up leaving substantial money on the table. Business brokers typically put asking prices on businesses and negotiate serially as opposed to simultaneously, which almost always gives acquirers the upper hand.

If you would like more information on the formal sell-side process, please give us a call at +1-215-268-7586 or use the contact for below:

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