CINCINNATI — I recently had the privilege of speaking at the Drycleaning and Laundry Expo West (DLEW) in Las Vegas. I shared some of the top insights that Tide Cleaners has gained over the past 16 years regarding the acquisition and conversion of dry cleaners.
Tide Cleaners has 198 locations across the U.S., with nearly half coming through acquisition. These deals span the country, and through this experience of speaking with sellers, we've discovered several key considerations that owners should evaluate when contemplating the sale of their business.
In an industry where multi-generational ownership is common, we know that selling a business is deeply personal. Each transaction is unique, but here are some of the top insights I shared with the DLEW audience:
Define EBITDA early — It is essential to define EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) clearly from the start. Often, sellers and buyers have different interpretations of what should be included in this calculation. Establishing this definition early — especially if brokers are involved — helps avoid costly confusion and delays.
If you’re active in day-to-day operations, don’t forget to account for yourself — If you plan to step away from the business post-sale, factor in the cost of replacing yourself in daily operations. Many sellers focus only on cash flow, but accurately valuing your business means calculating general and administrative (G&A) expenses. This adjustment can significantly impact EBITDA and final valuation.
Determine what “fair value” means to you — Sellers often ask, “What’s a fair price for my business?” The answer is different for everyone. Sellers need to have a clear understanding of what “fair value” means for them, based on their financial needs and goals. Value isn’t the same for everyone — each seller looks at the financial, legacy and people vectors differently when determining what they want from a sale. For some sellers we’ve worked with, the deal only closed once they felt confident that Tide franchisees could take care of their top clients and key managers.
Seller-based financing can open new opportunities — We’ve seen some successful deals come together when sellers are open to creative financing options. In some cases, introducing additional buyers or structuring creative financing solutions can bridge gaps between asking price and offer, making the sale more achievable for both sides.
Sellers deserve time to decide — Selling a business is a significant decision, and it shouldn’t be rushed. We value giving potential sellers the time and space they need to consider their options fully. Reconnecting after a few months often helps sellers feel more confident about moving forward when they’re ready.
While Tide Cleaners may not be the right fit for every seller, these insights can guide anyone considering a sale.
Have a question or comment? E-mail our editor Dave Davis at [email protected].
