We are looking at a linehaul business to buy and the broker took a picture of a proforma and sent it via cell phone to me and said this is how we do business.....I have 2 questions, this broker said: 1. 95% of all buyers pay cash, true or false? 2. Sellers almost never hold back 10-20% of a sale amount for a short term? True or false? I know this is isn't cut and dry, but 2 other brokers would not even call me because I couldn't show 100% of the cash needed to buy the business...I have 75% cash, income and a banking relationship that will finance the balance based on a 18 year relationship and past performance....this is a very unsophisticated space....
I can’t speak on behalf of selling brokers , because i disagree with essentially all aspects of their business model. But yes , 95% are cash (although if there are trucks included in the deal we can finance the trucks) and yes sellers rarely ever hold a note, becuase they don’t have to. Theres a limited supply of decent linehaul businesses for sale , and a huge # of cash buyers for deals under 850K ish - so it’s just not necessary - in your case , with 75% cash, there are many deals where you can take a loan on the trucks (quickly and easily) for over 25% of the price of the deal. It starts with making sure you are buying great runs , not garbage a broker is looking to unload at 5x
@@likhive Thank you ...the total project is $3.5 mm. Cash on Cash returns is our goal...with low leverage, when brokers dont understand basic finance and think we are unqualified enough to not even call us back is not something we have ever dealt with. We have deep operational expertise in fleet as well as capital markets expertise. They are selling ay 2.8x unlevered....Thanks for detailing your answer.
This was very informative. Thank you
We are looking at a linehaul business to buy and the broker took a picture of a proforma and sent it via cell phone to me and said this is how we do business.....I have 2 questions, this broker said: 1. 95% of all buyers pay cash, true or false? 2. Sellers almost never hold back 10-20% of a sale amount for a short term? True or false? I know this is isn't cut and dry, but 2 other brokers would not even call me because I couldn't show 100% of the cash needed to buy the business...I have 75% cash, income and a banking relationship that will finance the balance based on a 18 year relationship and past performance....this is a very unsophisticated space....
I can’t speak on behalf of selling brokers , because i disagree with essentially all aspects of their business model. But yes , 95% are cash (although if there are trucks included in the deal we can finance the trucks) and yes sellers rarely ever hold a note, becuase they don’t have to. Theres a limited supply of decent linehaul businesses for sale , and a huge # of cash buyers for deals under 850K ish - so it’s just not necessary - in your case , with 75% cash, there are many deals where you can take a loan on the trucks (quickly and easily) for over 25% of the price of the deal. It starts with making sure you are buying great runs , not garbage a broker is looking to unload at 5x
@@likhive Thank you ...the total project is $3.5 mm. Cash on Cash returns is our goal...with low leverage, when brokers dont understand basic finance and think we are unqualified enough to not even call us back is not something we have ever dealt with. We have deep operational expertise in fleet as well as capital markets expertise. They are selling ay 2.8x unlevered....Thanks for detailing your answer.
Great point- industry averages. Where do i find that info? Is there a website?
There’s not - anywhere - you’ll have to go to people like John haldi for help. We can also assist
awesome video, like watching you information. thanks
another great video!
Great information.
Thank you
Happy to help! Make sure you ask any questions you might have here in the comments or on our Facebook page!
Really good info.
I was considering routes where I am.
Pretty low price and. Not like long haul.
Do you consider long haul better investments?