Industry Updates - Vending, Micro Markets and Office Coffee Services
We have buyers!
GREAT News? - This industry has more buyers than ever before! After the Covid narrative hurting many food service operations, we have interested companies looking for acquisitions – especially in vending. We are seeing Micro Markets replace cafeterias and food service locations. The easiest and fastest way for food service providers to continue growth is to acquire talent through acquisitions. We have multiple buyers so reach out to see what we can do for you to make the exit plan strategy easier and more lucrative. Most buyers will want your employees and talent, so you can factor this in to your decision.
Watch the video below of Broker/Owner Mike Ferguson while at the 2022 NAMA trade show.
From a real customer that I sold the business in April, 2020:
Mike,
"I want to personally thank you for all of your help in facilitating the sale of our business. Thank you for answering all of our questions, and for explaining everything so well.
Everyone at XXXXXXXXX ( Buyer) we met are wonderful people, and we feel very comfortable and blessed to be turning it over to them. Everything went splendid with introductions and conversations with them at our accounts. It was a fun business, although a lot of hard work, and we will miss aspects of it and all the wonderful people that we have been blessed to service.
We are SO excited to have it done!!"
"Thank you so much!!
God Bless You!"
From a real customer sold in 2021:
Mike, You can always use me as a reference! You did a great job and I’m very appreciative of your efforts. Guessing this deal was a bit of a strain, but YOU Got It Done! Use me as a reference - I have been treated very fairly!
From a real customer in 2022:
Mike, Thank you so much for all that you did. we could have never got such a great deal as you did for us for our business! Hopefully, we can relax and go on vacation together now !
_______________________________________________________________________________________________________________
I talked to an operator recently who asked me if I would do a valuation of his business. His comment was: “I paid an accounting firm $10,000 to do a valuation on my company, and they said I was worth close to zero”. Needless to say, he was upset with his valuation from the accounting firm. This is the first mistake some operators have made. While the value may be worth zero to an outside industry investor, generally this is not the case when we sell operators to other operators.
Most valuation reports would include
-
Market Value
-
Asset-Based Valuation
-
ROI-Based Valuation
-
Discounted Cash Flow
-
Capitalization of earnings
-
Multiples of earnings
-
Book Value
Business brokers from outside the industry may base it in EBITDA (Earnings Before Interest, tax, depreciation, and amortization), or a multiple of EBITDA. Vending is a different business in that you have assets all over town, trucks, markets, non-contracts for clients and it is mostly a cash business. Some vending operators may not report 100% of their cash in sales figures. Many businesses do not have an EBITDA to report. So, to get a true valuation of your business, you should use an industry expert who can discuss this with you. Your business may be worth more to a local current operator who can tuck in your business into theirs, thus cutting the overhead, salary, and expenses and generate their ROI (return on investment). I do have some buyers who are looking to expand into other areas that they are not currently in. I have even made deals where the buyer also buys the real estate and keeps the owners and employees on to continue to grow the business. Acquiring talent is one of the best parts of an acquisition, and many buyers need experienced talent.
So, you survived the pandemic, are you ready to table the risk and exit the ownership of the business? If the answer is no, then we would recommend you refining your business into a profitable, well ran operation so when that time comes, you will be ready. If you are ready to sell, you should reach out to an industry expert to see what your business may be worth. There were several acquisitions that took place towards the end of 2020, 2021 and more in 2022. If the time is right for you to make an exit plan, you should take the proper arrangements to get the most out of your business.
Mike Ferguson, owner of VMAC Solutions, LLC is a former Vending and Office Coffee business owner and operator, turned specialized Intermediary Business Broker. Who better to discuss the selling of your business than from a former owner and operator of over 33 years in the Convenience Service business. Mike is very excited about the future of vending and coffee being great. Mike always says, “I speak fluent Vending and Office Coffee”. Mike can be met at most major NAMA events. You can reach Mike at 713-569-6463, or email Mike@VMACsolutions.com.