Once an owner has made the decision to sell, their attitude about how to approach the selling process is of critical importance. While some choose to take the path of least resistance, others accept that the process of selling their business must be approached in the same way as any other important project or task. This approach may have a significant impact on the selling process and can determine one’s success or failure in the effort to find qualified buyers and to facilitate the sale of their aviation business.
Though their reasons may vary, once the decision is made in the affirmative, an owner’s first step must be to determine whether or not the business is indeed, ready to sell.
Here are three of the most obvious ways that one can gauge their readiness to put the business on the market and begin the selling process.
Identify the base of potential buyers
To the aviation business owner who hasn’t experienced the process of selling their business, there is one undeniable fact: selling an aviation business (especially an aircraft maintenance operation) is not like selling real estate. Aircraft maintenance businesses are unique entities, with a limited base of qualified buyers, and the process of marketing, buyer screening, and presentation demands specific expertise and industry knowledge that the local real estate agent usually doesn’t have.
While FBO acquisition opportunities tend to attract a wide range of potential buyers (some qualified and some not), the buyer demographic for aircraft maintenance businesses is typically much narrower. Buyers are generally from within the industry and knowledgeable about processes, regulations, and the scope of services they’ll want to acquire and provide.
Knowing this, the business owner’s first step in the selling process is to honestly identify and determine who their base of potential buyers may be. These candidates may include the local FBO, an aircraft charter or flight school operator, competitors, senior maintenance employees or managers, or a larger regional maintenance operator.
Gather and organize key information
Once the potential buyer base is identified, the next step is to gather, organize, and develop a professional package that presents the company, its operations, financials, and other pertinent information. Whether this is accomplished “in-house” or by an outside consultant, the goal is to present the qualified buyer with information, data, and materials that portray the company in the best light possible. And, perhaps most important of all, the sales price of the business must be determined and included in the package before the first contact or exchange of information begins with any prospective buyers.
As one positions their aviation company for a sale, the type and quality of the information conveyed to the buyer will be the key to success in the selling process. Many owners make the disastrous mistake of thinking that the “financials” are all that buyers are interested in. In reality, nothing is further from the truth. Legitimate buyers want to know the details behind the financial picture. They’re interested in the how and why of the business’ success and they want to know where the future potential is. They’re interested in information about the company’s assets, facilities, FAA certifications, key personnel, airport and landlord relationships, owned aircraft, and validation of the customer base. All are essential to the buyers’ decision-making process.
Until the owner takes the time to ensure that the informational package being conveyed to the buyer accurately describes the scope of their aircraft maintenance business, they’re not ready to sell.
The final step: buyer-screening
One final key: During the selling process, confidentiality is usually a critical issue.
Before the business is ready to sell, the final step is to decide who will be involved in the selling process, and how those representatives will interact with prospects, screening, information exchanges, and followup. The absence of a buyer screening plan may risk the inadvertent release of information or disclosure about the potential sale to people who the owner may not want to know about the potential sale (airport personnel, key employees, bankers, customers, and others).
Our goal is to streamline the process of marketing these unique types of aviaton businesses. We offer a specialized range of professional services for FBOs and General Aviation businesses (owners...
Ground Clutter What It's Worth By Ralph Hood July 2004 Ifit is difficult for airport landlords and tenants to determine a fairlease, it is even more so to arrive at a...
Evaluating the Business Independent assessments of FBOs, other businesses are on the rise as owners look to sell or expand BY Michael L. Dye, Senior Analyst/Consultant, Airport Business...