HOW TO SELL A FOOD TRUCK BUSINESS

Selling your food truck business is one of the most important decisions you may have to make if you are starting to feel that the time has come to cash in on what you have been building all these years. Whether it is because you have other business or investment opportunities that you would like to invest in, or if you are ready to retire and travel the world, the decision to sell may be hard to make. But, when you are ready to make that decision, these important tips below may help you prepare to sell your food truck business as fast as possible, while still getting the best price possible. Over the last five years, food trucks have risen in popularity throughout our country. There are tens of thousands of food trucks across the United States, and you can pretty much spot them across some of our larger city’s, and at sporting events, or other venues. Food trucks have become very popular, and the industry has seen a 6.8 percent increase in growth in the last five years, which makes this the perfect time to cash out and get top dollar for selling your food truck business. For your food truck business to have become a success, you have had to pour a lot of time, energy, and money into building it and making it successful. This is why there is value for someone to buy your business, so they can hit the ground running by starting with a fully functioning, and profitable business. There is value in the truck, the equipment, the documented routes or places to setup that are profitable, that you have learned by trial and error. There is value in the website, if you have a website. There is value in the business name, the reputation that you have built as you have built a loyal customer base that knows you have good food, deserts, or beverages that they enjoy. There is value in the recipes you have made that your customers love. Most importantly, there is value in the income and profits that you have that you can prove on paper that will be carried forward with the new owners of your amazing food truck business.

7 Steps To Take When Selling Your Food Truck Business

Whether your food truck sells hot dogs, burgers, italian food, mexican food, chinese food, ice cream, pretzels, popcorn, or any food or beverage item, the selling process is relatively similar and straight forward. Take the following seven steps into consideration as you begin to prep your business for sale. 1. Plan Your Exit 2. Get Your Business Ready to Sell 3. Gather and Organize Your Documents 4. Hire a Business Broker 5. Get a Business Valuation 6. Set Your Food Truck Business Selling Price 7. List Your Business For Sale

Plan Your Exit From Your Food Truck Business

The first thing to start working on is to plan your exit from your Food Truck Business. Any potential business buyer will want to see and understand how your business will run without you. The answers to these questions will help get you started in thinking about the right things to help you get organized and ready to sell your food truck business.

Some questions to think about:

1. When do you plan on leaving your business? 2. Will your current team members stay with the food truck? 3. Does your food truck need any renovations? 4. How long are you willing to provide training to the new owner?

Get Your Food Truck Business Ready To Sell

When you are ready to sell your food truck business, you should do some work to get it ready for potential buyers to take a look at it. A new owner will want to walk right into the business and have everything working, have happy customers that they will be proud to show that they are the new owner that will be providing the great products that they will continue to enjoy. You will want to make your business stand out from the others, so it will sell quickly and get you the best price to make the most profit.

Some good things to work on are:

1. Fix anything that needs to be upgraded or repaired. 2. Add to the curb appeal, and the internal look as well, to attract more customers, and potential buyers. 3. Get more engaged on your social media to continue to grow your customer base. 4. Expand or fine tune your menu options. 5. Encourage customers to write positive reviews online to show others how great your product is. 6. Look for new money making routes, events, festivals, to identify additional sources of revenue.

Get your Documents Organized

Now it’s time to start preparing your business paperwork to make sure you can show that you have your business in order. Any potential buyer will want to see your financial documents that will show them that there is value in the business and it is worth what you are selling it for. They will want to be able to see what the business tax returns show, the cash flow each month, income statements, balance sheets. They will want to see that you can prove the value is there. It will show them that you knew what you were doing, you are making a good profit, and this is a good investment for them to buy your food truck business. Some business sellers will engage their accountant to help them with this piece if you have some complicated financials, or if you have an accountant that is already familiar with your business and may even have this paperwork easily put together.

Documents you may want to gather:

1. One to three years of profit and loss statements. 2. One to three years worth of balance sheets. 3. One to three years of full tax returns. 4. Inventory list of equipment. 5. Inventory list of product and supplies. 6. Pink Slip or loan details for the actual food truck itself. 7. Any service or product contracts, etc, that you may have. 8. Any licensing or permits, so the new buyer will understand what they need to start applying for in their name.

List of Equipment

You should give an estimate for the value of all of your equipment in an itemized list. You should include any information or paperwork that you have that would back up the estimated value for the equipment as well. This would include your truck, any stoves, grills, microwaves, tables and chairs, awning, heaters, freezers, blenders, refrigerators, or anything else of value that helps to add to the value of the food truck business. Other documentation may be needed as well, so it is good to pull those together if you can so that you have them ready. The more documentation that you have, the easier it is to show any potential buyers that your business is stable, profitable, and a good investment opportunity. You may need to provide any insurance policies, employment agreements, supplier contracts, documentation for any trademarked or copyrighted recipes that you have created (many sellers do not have these), equipment leases, bank statements, business loans, agreements with property owners that you park your food truck at. The more paperwork that you have ready to go, the better. But, do not overwhelm yourself. Gather what you can quickly and easily, so that you can provide some information to your business broker. Then, if you can come up with more documentation as you move forward that is great. It takes several days to get your business listed, and can take months to sometimes years, to find the right buyer. So you usuallly have quite a bit of time to pull additional documentation together. Also, don’t be worried about sharing information with potential buyers. Your business broker can have any potential buyers prove that they have the funds to buy the business, and sign a Non-Disclosure Agreement (NDA), so they won’t be able to share your information with others.

Hire A Business Broker To Sell Your Food Truck Business

If you’re looking to buy or sell your food truck business you should use an experience professional who understands the market and can save you both time and money. If you would like to discuss any of this further or the types of services that are offered, please contact Michelle Mendenhall as she is a Certified Business Broker that is a member of the IBBA (International Business Brokers Association), and a Commercial Real Estate Specialist. Visit her website at LocalGirlGoesCommercial.com

Get an Accurate Valuation

Now that you have hired a business broker to sell your food truck business, they will work with you to determine the value of your business. It’s good to put some thought into what this number should be for yourself as well, so that you have a good ball park number to start from. You know your business best, but there are several ways to go about valuing your food truck businesses, and the help of a qualified and experienced business broker will ensure that you put together an accurate asking price for your business that will attract the right buyers, and get the business sold in the shortest amount of time, with the highest income potential to make it more profitable for you. A business broker does not typically charge you anything unless your business is sold. Though, this is a conversation they will have with you so that you fully understand what they will charge for their services. Your business broker will consider the value of your food truck, the net income of your business, as well as any other assets, or liabilities that you have with the business. Some food trucks can bring in a lot of income, but may not be profitable. If your is highly profitable, it’s important that you are able to show that, because this will increase the value of your business tremendously.

Set Your Food Truck Business Selling Price

Picking the right price to sell your business is important. This price point is what will attract buyers to make the decision to look into buying your business or not. This is why they should know what it is worth to you is important. If you are looking to sell it quickly, the best thing you can do is set the price a little low, to attract more buyers. You never know, multiple buyers may become interested in buying your business, which may make one or both of them offer you more so that they can buy it. Setting a price that is too high may scare away potential buyers because they will think that the business just is not a good investment for them, or they may feel that you are not really that serious about selling it.

List Your Food Truck On The Market

The final step in getting your business ready to sell is to list your food truck on the market so people know that it is for sale. There are a lot of places that you can advertise your business for sale, but your business broker will handle all of this for you. If you hire an experienced business broker, they will create advertising material, and send it to you for your approval of the content, and how it looks. A professional business broker has access to advertising streams that have serious and active buyers that are looking to buy a business, to give you the best visibility. If you are ready to sell your food truck business, you should consider partnering with Michelle Mendenhall with Local Girl Goes Commercial. She has years of commercial real estate experience, she is a Certified Business Broker, and she has access to the right pool of potential buyers as she is a member of many different business selling websites to give your business for sale listing the right exposure to get it sold. Get in touch with Michelle and get started today! At ViralStudioX, we highlight products and services that you might find interesting. We frequently receive free products from manufacturers to test. This does not drive our decision as to whether or not a product is featured or recommended. If you click a link on this page, then go on to make a purchase, we might receive a commission – at no extra cost to you, and does not impact the purchase price of any products that you may purchase.