Looking_4_Independent_Agency

[Guest]

Looking for an independent agency for sale in DFW or surrounding area. Would like to find an agecy that has a standard book to sell. All I can find are Allstate agencies and they are by the 100's. Any help would be greatly appreciated.

 

[moeasadi]

search on BiZQuest dot com.I am looking for the same in Ca.

 

[Bertolinoins]

Good agencies never hit the open market. You need to talk to your sales reps to develop your targets (retirement age without kids in the business or younger producers in line to take over) with a solid/stable/profitable book. Sales reps spend all day everyday meeting with agency owners... Good relationships with them are very important if you want the inside track on that type of info. I have purchased 3 agencies in the past two years and have 8-9 in the courting stage for when they are ready to sell... none of these agencies will hit the open market.
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Sidenote- build a real relationship with your sales reps to get the real dirt... a happy hour is more effective than a typical sales meeting. Do then favors that make them look good to their bosses and they will repay you.

 

[Guest]

Good agencies never hit the open market. You need to talk to your sales reps to develop your targets (retirement age without kids in the business or younger producers in line to take over) with a solid/stable/profitable book. Sales reps spend all day everyday meeting with agency owners... Good relationships with them are very important if you want the inside track on that type of info. I have purchased 3 agencies in the past two years and have 8-9 in the courting stage for when they are ready to sell... none of these agencies will hit the open market.
- - - - - - - - - - - - - - - - - -
Sidenote- build a real relationship with your sales reps to get the real dirt... a happy hour is more effective than a typical sales meeting. Do then favors that make them look good to their bosses and they will repay you.

Im finding this to be very true. I have my name in the hat with a few older agents now. I have found a few small books but not sure they are worth investing the time and money into. Plus these guys think they are gold. Thanks for your post.

 

[xrac]

Good agencies never hit the open market. You need to talk to your sales reps to develop your targets (retirement age without kids in the business or younger producers in line to take over) with a solid/stable/profitable book. Sales reps spend all day everyday meeting with agency owners... Good relationships with them are very important if you want the inside track on that type of info. I have purchased 3 agencies in the past two years and have 8-9 in the courting stage for when they are ready to sell... none of these agencies will hit the open market.
- - - - - - - - - - - - - - - - - -
Sidenote- build a real relationship with your sales reps to get the real dirt... a happy hour is more effective than a typical sales meeting. Do then favors that make them look good to their bosses and they will repay you.

My business experience is almost no business worth buying (insurance or otherwise) ever reaches the open market. The ones that reach the open market are the ones that people do not want or where the asking price is unrealistic.

 

[Bertolinoins]

Im finding this to be very true. I have my name in the hat with a few older agents now. I have found a few small books but not sure they are worth investing the time and money into. Plus these guys think they are gold. Thanks for your post.

There are a lot of very unrealistic agency owners out there that hear about multiples offered (3X revenue, etc) but they have no idea what their business is actually worth. I ran into a guy that was shrinking and wasn't making much money... had an EBITA of 6% this year and projected to go red next year but felt his agency was worth 2X revenue because that is what he was offered several years ago when Brooke was throwing money around. He has a good volume with my major companies so it would really help my profit sharing so I am still chasing him. Sometimes guys just need a reality check. Tell them to talk to Brown & Brown or USI and those guys will break down the book and make the owner feel 6 inches tall if his operation isn't running on the right metrics. Then you can swoop in and look like a good guy with any reasonable offer.

 

[Guest]

There are a lot of very unrealistic agency owners out there that hear about multiples offered (3X revenue, etc) but they have no idea what their business is actually worth. I ran into a guy that was shrinking and wasn't making much money... had an EBITA of 6% this year and projected to go red next year but felt his agency was worth 2X revenue because that is what he was offered several years ago when Brooke was throwing money around. He has a good volume with my major companies so it would really help my profit sharing so I am still chasing him. Sometimes guys just need a reality check. Tell them to talk to Brown & Brown or USI and those guys will break down the book and make the owner feel 6 inches tall if his operation isn't running on the right metrics. Then you can swoop in and look like a good guy with any reasonable offer.

Good point I talked with two owners today that felt their book was worth 3x's what I felt they should be asking. When I asked why they felt their business was worth so much the answer from both was "This is my lifes work".

 

[xrac]

No business is worth any more than what someone will pay for it at this moment in time. A lot of owners are greedy and hold on to a business too long and then it goes down the toilet and becomes either worthless or worth very little.

 

[Bertolinoins]

Good point I talked with two owners today that felt their book was worth 3x's what I felt they should be asking. When I asked why they felt their business was worth so much the answer from both was "This is my lifes work".

Don't give up on them. Let a few of the national houses string them along for months before offering 7 X EBITA, demanding to fold them in, change the name and fire half the staff. When reality hits... ride in with a fair but profitable deal that will honor their life's work. Stroke their ego but stick to your price.

 

[Guest]

Since I am no pro at this I have been considering hiring a consultant to guide me through this process. I still do not have any agency found, but I do have some in mind I would like to approach. I thought having someone like this may help my chances when approaching an agency. Here is the one a Safeco rep suggested. Stroman Consulting Group . Any pointers with going this route?