December 13, 2017
Perhaps you always planned to build a thriving campground to eventually sell for a tidy sum – or maybe for unexpected personal reasons it’s best to sell your campground sooner rather than later.
No matter what the reason for selling your campground, experts agree: it’s best to be prepared well in advance as it can take years to complete a successful sale.
These four tips for selling a campground will help you get a head start on making your park attractive to buyers for the day you’re ready to sell.
Even if a campground sale isn’t imminent for the next five years, it isn’t too early to meet with an appraiser. A valuation will give you a realistic picture of what your campground business is worth right now, and invaluable information on what you can do to improve its value.
When you’re ready to sell, having already had an appraisal can be a real plus for potential buyers. Sharing the details of your valuation shows transparency, creating trust and building credibility—while saving a buyer the expense of getting one done themselves.
Remember that timing is often everything with a campground sale. Once you know what your campground is worth, you can decide whether it’s best to move forward—or wait for a growth phase or improved economic conditions.
Every business, large or small, needs a succession plan. And when you’re ready to sell, having an exit strategy in place will put a buyer’s mind at ease because you’ll have already ironed out a smooth transition for you and the new owner.
A succession plan should include both the human resources aspect (e.g. a training plan for the new owner and any employees that stay on when ownership is transferred), as well as the management of any financial, legal, or tax issues.
Once you’ve made all the hard decisions about how the campground will run without you, be sure to review it once a year to make sure it’s always up to date.
The biggest red flag for anyone considering any business deal is disorganized or incomplete financial records. A potential buyer will want to see your yearly tax returns for the last three to five years, as well as balance sheets and profit and loss statements. You may also be asked to share accurate sales and marketing data, the value of your assets and any outstanding liabilities – as well as your plans to resolve them.
Work with an accounting firm who understands your industry and your business. Have them maintain clean and complete financial records as well as advise you on ways to increase the value of your business.
Hiring a business broker with a proven track record can really simplify the process of selling a campground —especially if you’re too busy to look for an interested buyer or need professional expertise to get your campground in order to sell on your preferred timeline.
You’ll want to meet with a few brokers to make sure you find the right fit. Look for someone with experience selling campgrounds, a large database of interested buyers, and an impressive closing ratio.
When you interview a broker, ask for testimonials and info on the strategies they’ll use to market and sell your campground. Reach out to your network for referrals—as with any professional service, when it comes to business brokers, an honest recommendation can help you find a winner.
Final tips for selling a campground
Work with your accountant and your broker about the best way to structure your campground sale for the best return. If you’ve built up some solid equity, it may be wise to offer a buyer a gradual sale or lease. In addition to a continued income stream for you, this type of arrangement can help make the deal attractive by reducing the new owner’s financial burden. The way you structure the sale will also have serious tax consequences.
At Campground Accounting, we specialize in working with Campground and RV Park owners throughout the USA. Our industry knowledge is focused on taking the headaches out of accounting and helping your grow your campground’s value. Whether you are selling a campground or you plan to own it for years to come, don’t you owe it to yourself to see how we can help you? Schedule a complimentary chat with us today at www.campgroundaccounting.com/meet.