At the beginning of 2014, my partner and son, Eric, asked me what my thoughts were on a sale price, because he was approached by a purchaser, for the Team Oil Travel Center. I told Eric, one year’s gross would be fine.
Eric made the comment, “What if the price of gas bottoms out”? As we all know in this business, the price of gas affects the gross in a big way. I told Eric, I doubt very much if the price will change much in the near future. Boy was I wrong!
I’ve spent my whole life buying and selling, shooting from the hip. Obviously I need ‘Hip surgery’. In this ever changing market, one can no longer rely on constant anything. One has to be able to adapt to the ever changing global economy. I’ve learned whenever we decide to set a price on a business it better not be fluid. Just because I’ve been able to do it in the past, doesn’t mean my way of selling property will continue to work in today’s business environment.
I have decided to meet Eric half way—we are a 50/50 corporation—on setting a price. Instead of the fluid market approach, or gross sales, I will go back to my old reliable, ‘GUT feeling’. Sellers sell on ‘what is’, and buyers buy on ‘what could be’. It is a simple formula. The two have one thing in common, “Do both when you don’t have too.”
Tony Huppert is a Wisconsin businessman of 40 years and CEO of Team Oil Inc., the family-owned and operated Team Oil Travel Center, and Subway in Spring Valley, Wis.