Selling an Automotive Business in Florida
A Guide for Florida Automotive Business Owners by Patrick Archer, MBA, CBI, CM&AP | Florida M&A Advisor | Calder Associates of Florida | 305.763.4112 (Mobile) 407.499.2855 (Office)
Selling an Automotive Business in Florida
Selling an Automotive Business in Florida is an important decision for owners of these essential business in the Sunshine State. Owners contemplating selling a Florida automotive business must weigh the pros and cons of selling the business. Retirement is the primary motivating factor for most owners, while other owners may be planning to pursue new ventures in different industries.
Regardless of the motivations, sellers of auto sales, repair, cleaning and transportation businesses in Florida will want to package and price the business to stand apart from competing listings and attract potential buyers. Many of these buyers are looking to take ownership of a successful business in Florida and tap into the positive demographics, population growth, median household income and other trends benefitting Florida small business owners today.
Timing Considerations for Selling an Automotive Business in Florida
If you are the owner of a successful automotive business in Florida, now could be a great time to take advantage of these trends and the rising demand among U.S. and international buyers for great businesses for sale in Florida that are established, profitable, “essential” in the eyes of local governments, and resistant to external pressures like recessions and online retailers.
Selling an Automotive Business in Florida today can also help sellers command top dollar considering the supply and demand imbalance of available auto related businesses in Florida post-pandemic. While the pandemic wiped out thousands of small Florida businesses in sectors like restaurants, gyms and beauty salons, Florida auto sector businesses emerged stronger and more attractive in the eyes of their owners, their customers, and potential buyers.
The Auto Industry in Florida
Florida ranks third among the 50 states in the number of registered automobiles and seventh in the most road miles. Florida has over 20,000 registered mechanics and auto repair facilities statewide. These businesses provide repair and maintenance services for automotive vehicles, such as passenger cars, trucks, and vans, and all trailers.
“340,000 crashes a year on Florida roads mean no shortage of business for repair shops.”
Florida mechanics have specialized technical skills to diagnose and repair the mechanical and electrical systems for automotive vehicles, repair automotive interiors, and paint or repair automotive exteriors. Florida body shops and collision repair businesses have no shortage of business given the 340,000 auto crashes that occur annually in Florida. Not surprisingly, over 100,000 of those accidents occur in the Big 3 counties of Miami-Dade, Broward and Palm Beach.
Another essential automotive service is provided by Florida car wash and detailing businesses. In a state like Florida with warm weather year-round, washing your car on a weekly basis is standard operating procedure. Some drivers prefer to use a self-service car wash, while others prefer full-service and luxury detailing auto spas which charge hundreds or event thousands of dollars for their services.
“Many Florida drivers prefer self-service facilities, but others prefer full-service and luxury detailing auto spas.”
Many mobile detailing services in Florida also cater to owners of luxury yachts and aircraft. For business owners who want to advertise on their vehicles, there are Florida businesses that specialize in applying graphics (“wraps”) on fleet vehicles. Still other Florida auto shops offer professional window tinting and other customization services for high performance.
Skills needed for operating an Automotive Business in Florida
As in all states, the Automotive business in Florida is highly competitive, and owners of the most successful Automotive businesses have many years of experience and hundreds of satisfied customers.
Current owners thinking of selling an automotive business in Florida will want to know that potential buyers of the business have the operational knowledge, managerial skills and financial resources necessary to manage and grow the business for the next generation.
Most buyers of automotive businesses in Florida will pursue SBA financing, and most SBA lenders will want to see that the buyer has some knowledge or experience in the automotive industry.
“The most successful owners of Florida automotive businesses have many years of experience in the sector”
Ideally, a future owner of an Automotive business in Florida would already have several years experience as an employee or owner/operator of an automotive business in their home state or home country. Many owners of established Automotive businesses in Florida will only consider selling their business to a buyer who has a proven track record of Automotive industry experience.
Best Cities For Selling an Automotive Business in Florida
For potential buyers open to living anywhere in the Sunshine State, sellers of automotive businesses in Florida will be competing with other owners of similar business statewide. These buyers will be weighing several factors including a variety of demographic and quality of life metrics that will impact both their decision making process.
“Sellers of Florida automotive businesses will be competing with owners of similar businesses statewide”
Florida’s population of 23 million is spread throughout the state’s 67 counties, but the largest clusters of high net worth households paying top dollar for automotive services are concentrated in the southern half of the state along a ring of 14 coastal counties on the Atlantic Ocean and the Gulf of Mexico. This “golden horseshoe” of Florida demographics encompasses the 25 Wealthiest Zip Codes in Florida based on Average Gross Income.
“This 14-county coastal region is the Golden Horseshoe of Florida demographics.”
This coastal region extends from Tampa/St.Petersburg on the Gulf side, south to Naples/FortMyers and down to the Florida Keys, east to Miami/Fort Lauderdale and extending north through the coastal communities of Pompano Beach, Boca Raton, West Palm Beach, Jupiter, Stuart, Hobe Sound, Port Saint Lucie, Vero Beach and Melbourne. Some of Florida’s largest auto repair, customization, wash and detailing businesses are located in these cities.
And, of course, no conversation about desirable areas to live and own a business in Florida would be complete without mentioning the Orlando metropolitan area. “The City Beautiful” is one of the fastest-growing metros in the country, and the influx of new residents creates ample opportunities for new and existing business owners.
“With over 2 million residents, Orlando is one of the fastest-growing metros in the country.”
Long known as a tourism mecca and home to theme park giants like Disney and Universal, Orlando’s economy is increasingly diverse. And world class infrastructure improvements like the new $3 billion Terminal C at Orlando International Airport facilitate domestic and international arrivals and intrastate travel with the addition of Brightline, a high-speed rail link between Orlando and South Florida metros like Miami, Fort Lauderdale and West Palm Beach.
Median Asking Price of Automotive Businesses in Florida
Once you have decided on selling an automotive business in Florida, it’s a good idea to work with a licensed Florida business broker to get a better understanding of the current value of your business and a most probable selling price to qualified buyers business with cash or some combination of cash and financing, either through an SBA 7(a) loan, seller financing, a conventional bank loan, a leveraged buyout, assumption of debt, or some other mutual buyer/seller arrangement.
“The median asking price of Florida automotive businesses for sale is $327,000”
According to the Florida database of businesses for sale, the median asking price for an Automotive business in Florida is $327,000 for businesses generating over $250,000 in revenue and $100,000 in annual cash flow.
The range of asking prices for Florida automotive businesses extends from $139,000 on the low end to $750,000 on the high end for Florida auto related businesses generating over $250,000 in revenue and $100,000 in annual cash flow.
Median Annual Revenue of Automotive Businesses in Florida
With the right team, high-traffic location, positive reputation and an established customer base, automotive businesses in Florida can be great revenue generators for both current and future owners. According to the statewide database of businesses for sale in Florida, the median annual revenue for an automotive business in Florida is $533,000.
“The median annual revenue of Florida automotive businesses for sale is $533,000”
The range of annual revenue for Florida automotive businesses extends from $300,000 on the low end to $775,000 on the high end for Florida auto related businesses generating over $250,000 in revenue and $100,000 in annual cash flow.
Median Cash Flow of Automotive Businesses in Florida
Established and well managed Automotive businesses in Florida can produce significant cash flow benefitting both the current owner and future owners. According to the official database of businesses for sale in Florida, the median cash flow for an automotive business in Florida is $143,000. As such, automotive businesses in Florida enjoy a median cash flow of over 25% of annual revenues. ($143,000 / $533,000 = 26.8%)
“The median annual cash flow of Florida automotive businesses for sale is $143,000”
The range of annual cash flow for Florida automotive businesses extends from $130,000 on the low end to $212,000 on the high end for Florida auto related businesses generating over $250,000 in revenue and $100,000 in annual cash flow.
Additional Resources for Selling an Automotive Business in Florida
Selling an Automotive Business in Florida is a major life decision that requires serious due diligence and sound advice from an experienced and trusted M&A advisor.
If you would like to schedule an initial consultation regarding your business, current valuation and next steps, please call us at 305.763.4112, schedule a free consultation, or use the contact form below.