The majority of the Will writing businesses that are out there are categorised as lifestyle businesses. What this means is that that the people who own such businesses, it benefits and supports the owner solely.
These ventures cease to have any real-time value once the owners decide to retire. Most business owners would like to have a business that they can sell easily and so this piece will take you through some aspects of marketing a Will writing business.
Will writing businesses have characteristics that aren’t typical by any means. Some of these help with making a sale and some act as deterrents.
Let’s take a look at the components which will help the business stay afloat.
Through groundwork and preparation
It is important that your business is in a position to look saleable from the day of its inception. Business advisors believe that you must put in efforts in laying the groundwork for your business to prepare it well for a sale.
Ask yourself if you can portray years of growth in terms of profit and turnover? Are there any problems lurking at the back of your mind? If yes then make an attempt to solve these and ensure that the business you run today is something that you’d be interested in buying in future.
Is there a website? If yes what impression do you intend to make with it? How is the website looking and is it easy to navigate? Answering these questions will help you fix the loose ends.
How the valuation of the business takes place?
This one always has some difficulty up its sleeve – there are no set of rules that you need to follow through in order to carry out the valuation for your business. Interested buyers will surely take a look at the profits made over the last few years and gauge how much it will add to their pockets. However, there are various other variables that come into consideration and what may not look good on paper, might turn out to be really good after all!
One unique characteristic that sets a Will writing business apart is its Willbank. Prospective buyers will look at the multiple of the profits you make with your storage revenue excluding VAT.
Why is your Willbank important?
If you’re a small business owner or a sole proprietor, your Willbank is your most valuable and marketable asset. Consider these questions:
- Was you company appointed as an executor for any Wills?
- How much does your company earn by way of storage fees each year?
- What are the statistics when it comes to people who pass away each year from your Willbank?
- How many probates are you working on and do you outsource any of it? If that’s the case then what kind of revenue is generated?
If the answers to the above questions are positive then your Willbank is a key asset in your business and it will certainly pique the interests of a prospective buyer. In today’s market the overall value of a Will writing business is based on either the multiple of the profits earned or the revenue earned from the storage.
As a small business you can expect to receive up to 3x your net recurring storage revenue.
Positive features of a Will writing business
- The ‘in progress’ cash flow from storage
- Probable probate income from Willbank
- Market that rejuvenates itself
- Cross sales potential
- Attractive market position at a later stage
Negative features of a Will writing business
- Will the business function without you?
- Is it too dependent on you?
- Probability of future negligence of cases
- Threatened by technology (digital Wills)
- Future legislations and its effects on the business
It is really important that you position your business in a way that it is well prepared for a new buyer to sweep in and pay you a good amount in return. You can have separate divisions that deal with day to day Will templates and have space for document storage as well.
This will help you as a seller to present your business in a manner that is more attractive to a buyer. If you are planning to sell your Will writing business, it is best to consult professionals for guidance and valuation purposes.