Hardware / Lumber / Supply
According to market research company Statista, total sales brought in by hardware stores eclipsed the previous year's total by $10 billion in 2020. Unlike a lot of retailers, many hardware stores thrived with the onset of the COVID-19. With people mostly restricted to the confines of their homes, we saw a renewed interest by consumers towards home improvement projects. Since most hardware retailers were labeled as essential and able to keep their doors open, owners were able to take advantage of this surge as many reported historical bests in profits.
Many hardware store owners are asking: "Is now the right time to sell?"
While many hardware stores have enjoyed unprecedented growth since the pandemic struck, the focus for many now shifts to the future. As we continue to slowly emerge and return to normal life, it'd be naïve to believe that consumer shopping habits will remain or even return to where it was pre-pandemic.
As of the conclusion of Third Quarter 2022, the marketplace remains an advantageous place for business owners to transition their business. Since 2020, the buyer pool for businesses has increased dramatically due to historically low interest rates, high unemployment and low job satisfaction. However, there have been some early indicators signaling a shift in the marketplace. With rapid rates of inflation and interest rates spiking beyond even pre-pandemic levels, the buyer pool is projected to level off as many of the incentives to purchase an existing business disappear. Seller Financing has emerged as an alternative to traditional bank financing and remains an attractive selling point for buyers.
Over the last 40 years, Sunbelt Business Brokers has transitioned literally hundreds of hardware businesses. While much of our success can be attributed to the highly experienced and knowledgeable business intermediaries stationed in 140+ offices throughout the United States, Sunbelt Franchise Resales (SFR) has partnered with the world's largest hardware retailer cooperative in ACE Hardware and their subsidiary ACE Handyman Services (formerly Handyman Matters) to help educate their network of business owners on maximizing value and the business selling process. As a result, this has given us keen insights into how to effectively market this type of business and has allowed us to play an integral role in helping owners achieve their succession goals.
If you are an owner contemplating the sale of your business, it's never been more critical and beneficial to consult with someone who understands the marketplace, the selling process and how to appropriately value and market your business in order to maximize value.
Ready to explore selling your business? Contact us today for a free/no-obligation discussion and complimentary value range analysis!