April 6th, 2015
Stephen poses the following problem/question:
Because of family matters, I have to give up my business on the east coast and move across the country. My questions aren’t about starting up again, you have plenty of posts on that. My question is what to do with my business on the east coast that I put in 10 years building? I don’t want to just give it up. So I would like to know if you have any advice on selling my business to another photographer? I know you originally worked in Washington and are now in Oregon. what did you do with all your clients in Washington when you moved?
First of all I don’t have any first hand experience with selling businesses. Our business in the Seattle area was a real estate business. I shot almost exclusively my wife’s listings. I was the guy on my wife’s team that got the properties on the market and did all the marketing. Real estate agents typical don’t sell their businesses, at least I’ve never heard of it. The reason is, helping people sell their homes is not a commodity type business. It’s very personalized business. My wife’s clients worked with her because they liked working with her and trusted her to guide them though the home selling process and some friend or family member recommended her. Also, after we sold their home, they typically didn’t need our services again for many years. Realtors need to keep coming up with new clients continually, unlike a real estate photography business.
A real estate photography business is probably more of a commodity service than a listing agents business, although many of your real estate photography clients may use your service because they personally like doing business with you and like your work and you can’t sell that to someone else.
Here are some of my thoughts on selling your real estate photography business:
- Typically businesses are sold based on the yearly income and other factors the owner can document so documenting how much income your business generates is key to it’s value.
- Another factor determining the worth of your company is how organized your are. That is, can you document and train someone else to generate the same income you are now generating, or is it all in your head?
- You may be able to find someone that will give you cash for your business but my guess is that you are more likely to find someone that will work for you on a contract basis, to be trained and then work towards taking over the business while you manage the company and pay them out of the proceeds of their work. Then after some mutually agreed upon time or amount of money paid to you from the company, they take over completely.
Does anyone have some first hand experience with selling real estate photography businesses that has advice for Stephen? I think you could sell a real estate photography business if you can take the time to find a responsible future owner that is willing to be trained and go through a transition period where you remain in control of the company and take a share of the income during the transition.