Sell My Distribution Business in Arizona: the full guide

Most distributors do not make what they sell. The right to carry a brand in a territory is often the most valuable thing in the company, and it belongs to the manufacturer as much as it belongs to you.

So I ask for every line agreement before anything else. Some are written with assignment or change-of-control language. Some let the manufacturer approve or refuse a new owner. Some are a phone call and a price sheet. A buyer will pay differently for each, and a lender will ask the same question.

Your attorney reads the contract language. I am a broker, not your lawyer. My job is to find the approvals the deal needs early enough that the manufacturer hears about the sale on our schedule.

In a wholesale company the stock on the racks can be larger than a year of the owner's earnings. That makes the inventory treatment one of the biggest numbers in the deal. Many files are priced plus inventory at cost, counted jointly near closing. Others are all-in with a target level. Either way, product you would not reorder today gets pulled out of the count.

Receivables are the other half. Distributors extend terms to their accounts, so there is usually real money sitting in AR at closing. The buyer takes current receivables as working capital, or you keep and collect them. We decide which in the letter of intent and not in the last week of escrow.

How counts, dead stock, and schedules work is on inventory on Arizona business sales. The cash, AR, and payables side is on working capital on Arizona business sales.

Buyers read the customer list by revenue share. If a handful of accounts carry the year, they will want to know whether those accounts have written terms and whether the relationship runs through a sales rep or through you personally.

Concentration does not kill a sale. It changes the structure. A buyer may ask for part of the price as a seller note or an earnout tied to that account staying. I would rather show that risk in the first conversation than have a lender find it in underwriting.

How being the only person the big accounts call shows up on price is on how owner dependency affects price. What a buyer requests once they are under LOI is on due diligence for Arizona sellers.

Most distributors rent the building. If the landlord will not consent to an assignment, the buyer has inventory and no place to put it. I get the lease in front of the buyer early and start the consent package once the deal is real. The consent process is on lease assignment on Arizona business sales.

Confidentiality matters more here than in most sales. Competing distributors would love to call your accounts, and a manufacturer who hears the news secondhand may start talking to other distributors about your territory. Buyers get a teaser with no name, sign an NDA, and only then learn who you are. More on that process is on how a confidential sale works.