Your dealership valuation is an important first step. As promised, here is your exclusive overview of our proprietary planning process.
Some of the information you will need to arrive at true market value is listed below, as well as some rules of thumb used in determining values.
Initial Dealership Valuation
Factory Financial Statements (5 Year-End Dec and Current Year to Date)
List of all non-productive (those not directly related to the dealership) expenses listed on the statement
List of off statement income from dealership operations not listed on the statement
Determine actual cash flow profit of the dealership with 3 or 5-year average (statement bottom line + dealer salary + nonproductive expenses + off statement income + or – rent adjustment (to equal 8% x facility appraisal or sale price)
Facility Appraisal or Lease Terms
Demographics of your Primary Market Area (McNulty can provide)
Number of units in Operation (important to show parts and service opportunity)
New Vehicle Planning Potential as indicated by Factory
Furniture Fixtures & Equipment Valuation
Depreciated Book Value or Appraised Value to determine “Continued Use Value”. Optionally, use a formula of Book Value + ½ Accumulated Depreciation. In any case, the final valuation is the value agreed upon between buyer and seller.
Dealership Marketing Package
Property Valuation – Provides for property market value and location details
Phase I Environmental Site Assessment
Site Survey Plat or Legal Description (total acres, total square footage of buildings)
Variables Influencing Price
Area of Responsibility Map
Sales Effectiveness Reports, Customer Satisfaction Index (CSI) & Sales Satisfaction Index (SSI) – on Factory generated reports. (Ex: Market Master, DART, etc.)
Depreciation Schedule or Asset List
Operational Information – Supporting documentation usually requested during the due diligence period
Dealership Management System (DMS): Vendor, Own, Terms of Lease, Maintenance Cost
Leases & Contracts expected to be Assumed: Original Terms, Remaining Payments, Buy-Out
As you can see, the amount of information required to begin the planning process is substantial, but we hope you will trust in our decades of experience, attention to detail, and desire to find maximum value for your dealership by engaging with McNulty.
Call today 1-800-800-4728 for your confidential, no cost, no commitment evaluation.