This is, by far, the most common question we are asked at individual client agencies and during Q&A sessions at conferences and seminars in which Agency Consulting Group is involved. Every year we provide a general answer in the pages of our newsletter, The PIPELINE. For the past five years, agents haven’t liked the answer.…
The time comes in every agent’s life when he considers cashing out. This can be for any number of reasons such as the desire to spend time with friends and family, for health reasons, or even just the desire to do other things. He has built his career selling and servicing insurance and has made…
The question of why and how to select an outside consultant often arises in small closely-held companies like insurance agencies. There are five reasons to use a consultant and four rules for selecting a consultant. If your situation doesn’t fit one of these five reasons, you probably do not need to hire an outsider to…
Question: “Are you aware of any agency acquisition multiples resource? Multiples of pre-tax profit, revenues or EBITA? Also, have you seen any published materials on what agents are doing on average with respect to amortization of goodwill in acquisitions? Does everyone just go for the fastest or do agents spread it over longer?”
Have you ever bought or sold an agency? Did you use a consultant to structure the deal or did you do it yourself? If the latter, there’s a good chance you might have left a considerable amount of money on the table and didn’t even know it. Good mergers and acquisitions consultants don’t come cheap…
An agency owner at a big state conference was telling everyone in earshot that his agency was now worth 3.0 times revenues because he just got an appointment from “ABC” company. “ABC” company, as part of their sales pitch to agencies, suggests, or at least the agency owner inferred (and I’ve heard others infer the…
Many of us use outside resources from time to time and, as there are often questions about getting the most from external suppliers, I thought some comment might be in order on how to make the best use of the relationship. As both a consultant and a company that uses outside support occasionally, I think…
Business values are very often expressed as a multiple of EBITDA (Earnings Before Interest, Taxes, Depreciation, Amortization). People use EBITDA because intuitively, valuations makes more sense if they are expressed as a function of earnings rather than sales or assets. EBITDA though has several serious drawbacks. This article discusses the reasons why EBITDA should be…
Have you ever bought or sold an agency? Did you use a consultant to structure the deal or did you do it yourself? If the latter, there’s a good chance you might have left a considerable amount of money on the table and didn’t even know it. Good mergers and acquisitions consultants don’t come cheap…
Agency owners are often desperate for a simple, quick answer. Unfortunately, they inevitably pay for their haste. Voodoo valuations are powerfully attractive. They offer a quick and cheap way to pacify an agency owner’s curiosity and worry. Voodoo valuation are not easy to recognize and are often disguised as legitimate valuations. Here are a few…