For Sellers, the Curtain Rises Once
Personal issues enter the picture when longtime owners who haven’t yet taken that "emotional walk on the beach" find that they have no clear plan for a post-sale career or lifestyle. Time, unfortunately, will not be on their side as sellers while they clarify what they intend to do with the rest of their lives.
The psychology of buyers has to be considered as well. These days, they have a michael kors bags uk short-term mentality when it comes to valuation. Once, a buyer might have wanted to examine a seller’s profitability over several years before making an offer. That changed in 2010-2011 when many printing companies saw their values plummet in the aftermath of the recession.
Now, the buyer might base the offer on only a year’s worth of financial information—or perhaps on the numbers from just a couple of quarters. This tendency on the part of buyers means that a seller who delays could find that his company’s value has declined if the business has a bad year down the road. Large firms and those operating in growth segments like wide-format may be exempt from this "what have you done for me lately" attitude, but for the average commercial printing company, it’s the new normal.
In some ways, owning a printing company you intend to sell is like investing in the stock market. Because the value of what you own can fluctuate unpredictably, waiting for a market "peak" before you act can be a needlessly risky thing to do. It’s better to begin working with your M&A advisor so that when the right offer comes along at the right time, you will be ready. It will be here sooner than you think.
James A. Russell, partner at New Direction Partners, brings over 20 years of experience as a printing company executive having served as CEO of two family-owned graphic communication companies. During his tenure as owner and CEO of Arbor Press, a commercial printing company in Michigan, the company was an eight-time winner of the National Association for Printing Leadership’s (NAPL) prestigious Management Plus Awards program. Arbor Press was also recognized twice during his leadership as one of the 50 fastest growing printers in the country. Contact him at (610) 230-0635, ext. 703.