The Seattle Boat Show opened for its 72nd year last Friday at CenturyLink Field & Event Center and on the water in South Lake Union. The annual show is the largest on the Pacific Coast and an eagerly anticipated “must attend” event for many of the region’s boating enthusiasts. The Washington recreational boating & fishing industry generates over $4 billion a year for the state’s economy and is presently thriving with almost an 8% increase in sold or registered boats in Washington in 2018 over 2017. The Seattle Boat Show with its three acres of show space and two locations features over a 1000 boats & yachts, 400+ exhibitors, and 250 classes & seminars for attendees. The show is a critical revenue generating opportunity for boating & fishing industry entrepreneurs with vendors generating 30 – 60% of their annual sales from the event according to Northwest Marine Trade Association President & CEO, George Harris. The Seattle Boat Show is mirrored by the 64-year-old Spokane Boat Show in Eastern Washington for boating enthusiasts in the Inland Empire and the boating paradises of Lake Coeur d’Alene, Lake Pend Oreille, & Priest Lake. This year the Spokane Boat Show runs February 1 to 9 at the Spokane County Fair & Expo Center. These recreational boating oriented events combine with the Pacific Marine Expo, the largest commercial marine trade show on the West Coast, last held mid November 2018 in Seattle to illustrate the importance of the commercial & recreational boating industries to the residents & economy of Washington. An industry of this size & variety requires expert representation for entrepreneurs when they decide to sell their privately held companies and family businesses.
IBA, a Pacific Northwest mergers & acquisitions firm with a highly regarded marine transaction division staffed with experienced, knowledgeable, highly skilled professional intermediaries, uses information gained from these events, a steady stream of successfully facilitated transactions, and other industry resources to stay current on the market dynamics & conditions impacting the sale of businesses in the recreational & commercial boating industries. We have combined this knowledge with decades of experience in the industry and superior negotiation & deal facilitation skills to successfully sell marine businesses from Aberdeen to Port Townsend to Point Roberts and throughout Whatcom, Skagit, Snohomish, King, and Pierce Counties on the Puget Sound. The transactions have involved companies manufacturing products for the commercial & recreational boating industry, boat dealerships selling trailer sized pleasure crafts to yachts capable of circumnavigating the globe, service & repair businesses working on cargo vessels to ski boats, and niche providers selling products from marine toilets to custom made sails.
A comparison of a successful sale process for a recreational or commercial boating business can be easily made to a successful fishing trip. The two activities share the following steps.
- Bait or Lure Selection – Any fisherman knows that if you do not have the right bait or lure the probability of catching a fish is significantly diminished. The same is true for selling a business. The lure used to catch a buyer for a privately held company or family business has the following three components:
- Correct Pricing for the Business – Business buyers will make offers to purchase properly priced businesses. Overpriced businesses will sit on the bottom like a lead weighted hook without a worm generating limited interest from the marketplace. Correctly pricing a business is a subjective science that requires relevant knowledge & experience.
- Correct Presentation of the Offering – A business being offered for sale should be presented in an articulate, persuasive manner to the marketplace. You only have one chance to make a first impression on the marketplace. If the presentation is not professionally prepared & compelling, it will have a similar result as a poorly tied fly cast on the water incorrectly when seeking trout in a river.
- Creation of the Marketplace – The marketplace to sell businesses is governed by a desire to keep the information a business is for sale confidential from customers, employees, and suppliers. In a properly facilitated transaction, information a business is for sale will not become known in the public domain until the parties involved in the transaction announce the sale. This dynamic creates a hidden marketplace. Access to that marketplace is best obtained by employing an experienced business broker who like an experienced fishing guide knows where the “honey holes” and “fish” can be found.
- Skill – A reason exists why the same fishermen consistently catch their limit while others with the most expensive gear return home empty handed, SKILL. Consistently catching fish requires knowledge, experience, and ability. The same is true for selling a business. The most talented mergers & acquisitions brokers consistently sell their product for a premium value in a timely manner. The less talented make excuses for their lack of performance, sell the businesses for less than their “fair” market value, and take longer to sell the business. The best business brokers have confidence in their ability and are willing to be compensated at closing based on their performance. Weaker business brokers seek retainers and administrative fees to guarantee they get paid, even if all their client leaves the relationship with is a story about the one that got away.
- Rule Compliance – A fisherman has the potential to lose their catch to a fish & game warden if they do not have a current fishing license. An entrepreneur has the potential to lose proceeds from the sale or end up in litigation, if they do not consult an attorney and accountant as part of their sale process. The loss of a trophy Chinook salmon does not warrant the risk of failing to have a license when you go across the Columbia River Bar. Paying unnecessary taxes on a business sale due to an uneducated tax allocation or being sued due to insufficient representation & warranty protections in the asset purchase agreement do not warrant the cost savings of not employing a business attorney and CPA to review a transaction.
IBA, as the oldest business brokerage firm in the Pacific Northwest, has successfully put more business sale transactions in the boat (Over 4000) than any other firm in the region. The business brokers in our marine transaction division have industry leading knowledge, experience, and deal negotiation/facilitation abilities. If you are looking for an experienced guide to represent you through the sale process associated with selling a recreational or commercial boating business, we would welcome the opportunity to interview for the position. We are confident we can deliver a mounting worthy trophy representing you in the sale.
IBA, the Pacific Northwest’s premier business brokerage firm since 1975, is available as an information resource to the media, business brokerage, and mergers & acquisitions community on subjects relevant to the purchase & sale of privately held companies and family owned businesses. IBA is recognized as one of the best business brokerage firms in the nation based on its long track record of successfully negotiating “win-win” business sale transactions in environments of full disclosure employing “best practices”.