Are you thinking about selling your bail bond business? Although bail bonding companies make a fair amount of money, they can be difficult to sell. Due to inconsistent valuation and stifling government regulations, most bail businesses don’t hold their value when sold. The following are a few basic tips that will help you price your business just right before the sale.
What is the Basic Value of Your Business?
The rule of thumb is $50,000 per one million in liability written every year. So you will get about 200k if you write 4 million in liability annually. Many sellers feel like this formula yields an insufficient return, however sellers should at least use this rule to find a base figure for their business.
Selling the Biz
Most people don’t know how the bail bond business model works. Plus the bail bond industry is so regulated that it can be extremely difficult to find buyers that are qualified to purchase bail bond businesses. Many states have succession processes, so check your local laws before considering a buyer.
Market the Business
The business will not sell itself. There are a few commercial websites that owners can post to themselves. Use vibrantly colored flyers to market the sale of the bail bond business for direct mailing. Require potential buyers to sign a confidentiality disclosure before they review the books. Talk to lawyers and a broker to assist with closing the deal to increase the rate of return on your investment. After the initial deal, know that buyers may require financing. If you decide to finance some of the sale, there might be a decent rate of return.
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