Issue link: https://www.massageandbodyworkdigital.com/i/68165
"First, there may be assets in place such as equipment, furniture, real estate (if the business owns the facility), and cash on hand," says Robert J. Allen, a financial analyst in Tyler, Texas. "In addition, there may be some other specifically identifiable assets such as a trade name, signage, employees, and staff in place." Michael Soon Lee, a California residential specialist, agrees, but adds that the quality of your customer list is also very crucial. "Details are important because the new owner will want to quickly build a relationship with them, and there's an art to building a good list." (See Create a Client List, on page 70.) Other considerations that add value to your business, according to Lee, include: • Goodwill, the dollar value placed on your reputation, can add a lot of value to your business. • A top location is worth money, unless there are a lot of similar vacancies nearby. • Below-market rent adds value as opposed to opening a brand new location (at market rent) and having to make tenant improvements. • A finished space with massage tables, proper lighting, sound system, etc., is worth more. • Seller financing adds value to the business because it increases the pool of available buyers. Another huge factor is the amount of direct customer contact the owner has. Certified professional accountant (CPA) Christopher Farrell says, "If an owner does most of the face-to- face interaction with clients, there could be substantial doubt as to the number of clients that would move over to the new owner. Just because they like the current owner does not mean that they will like the new one. But, if employees do most of the hands-on work, then the name and reputation of the business play a larger factor. The ownership change [might] be invisible to the clients." Business consultant Brent Larlee says it's important to consider the number of competing businesses in the area. "If you are the only massage therapy [business] in a town or region, or if you are the largest, this information may add value to your business." He says another consideration involves the contracts or agreements the business has in place. For example, if there are some occupational therapy agreements that would survive (if the business was sold), then these will carry value. Millie Haynam, of Ohio-based Natural Beauty Salon & Spa, says trade secrets or body treatment formulas involved when selling your business may also add value. Plus, she says, you may have a considerable amount of outstanding gift certificates, and you'll need to factor those into the sale price as well. connect with your colleagues on massageprofessionals.com 65