Advice for a Manufacturer's Rep Looking to Sell?
July 11, 2024
by a professional from University of Illinois at Urbana-Champaign - College of Business in Indianapolis, IN, USA
What advice would you have for a Manufacturer's Rep looking to sell their business?
There are limited assets and the primary value is relationships built since the company's founding in 1986.
The industry is sporting goods apparel and the relationships are with:
1) the manufacturers who hold a license from professional sports teams and create the apparel
2) the retail organizations (e.g., sporting goods stores, clothing retailers)
One area of pent-up demand is fans of women’s sports who want to represent their teams — but don’t have enough merchandise to buy:
Boston Globe: Lack of Women's Sports Merchandise
The owner is expecting an earn-out will be necessary and is open to offering seller financing.
What challenges will the owner face in selling this business?
Do you know of Searchfunders who specialize in this kind of business?
from Emory University in Tucson, AZ, USA
From a buyer's perspective, purchasing this business means buying a high-risk job, as manufacturers can terminate their relationship at any time. Moreover, manufacturers may lose trust in the agency if the principal changes, leading them to consider bringing the accounts in-house, reassigning them to an existing rep, or consolidating them into a larger regional group.
(My partner comes from the gift industry, among others, and made a run at a rep group a long time past.)
in Denver, CO, USA