Selling a small co?

I don't get it either. It only takes 600 bucks and a couple of years of insurance and running to get what people are paying 7 figures for????

 

figure out how much you gross yearly. then check the Fed rate of inflation for about 5 years, add that to the gross.

maybe that's not how it's done, but if you sell it at your gross yearly earnings, and as you said, it has the potential for expansion, best you get in on that now, before the economy tanks again, then you're screwed for high dollar sale.

 

Why?

Because it is an established authorities with a great safety records and both of them have past contracts tied to it.

The insurance coming out of the transaction was the same for the past three years prior to me buying it, a new authority alone moving up to a small fleet status does not enjoy economy of scale, and there is low risk even under new management for the liabilities.

This is why.

I didn't go to them and say "hey Dave, I've got this authority sitting here making me no money, I want you to buy it for big bucks", but the first driver knew I had it and was going to shelve it so he asked if he could buy it and I said he has to buy the company with it (which I know wasn't mentioned but hey I'm tired this morning and can't remember everything), he looked at the potential and said I will give you $XXXXXXX and I said well nope I want less than that and he bought it. He had the business plan already, he had already two trucks and three owners willing to lease and he pulled it all together quickly.

The same case with the other one, except that driver didn't have a plan in place and I suggested he talk to Dave to see if he can help him out and did.

See what bothers me is that many of you don't see this happen, when it happens a lot. People buy existing parts of a business because of potential, not value.

 

Plus I read new carriers are having a tough time getting insured at all vs buying a existing and getting right to work? Maybe shippers buy them? Like new places shipping lots of stuff and need it?

 

I still don't see the point in paying 6 figures for an authority you can get for a very small fraction of that, just because it's got a good safety rating. With zero contracts that actually come with it I don't see how it having contracts before means anything.

 

People trying to evade the scrutiny of going new? But I don't see how...

 

I don’t get it either, freight contracts are not set in stone. New guy in management can change those situations overnight.

On the insurance deal, probably more to the story, like maybe time in the industry. I could probably go to my carrier and be running under my own numbers tomorrow if I wanted to.

 

I first got this idea a few yrs ago when a friend of mine was starting out. Insurance quotes were double what I paid. I called my ins and was told New Carriers have become such a risk they too were charging double for I believe 2 or 3 yrs.I wondered at that time if my Authority was worth at least the insurance savings. I guess if someone had plans to add trucks very fast it would really be worth even more . The DOT does target new #s already been through that.This website has a bunch of people looking to buy your authority in the classifieds. How Much? I’d like to know