The blue sky value of a dealership is determined by a variety of factors, including location, franchise, reputation, and profitability. In this article, we will take a closer look at each of these factors and provide tips on how to increase the blue sky value of your dealership.
Location
One of the most important factors that affect the blue sky value of a dealership is its location. A dealership located in a high-traffic area with good visibility is more valuable than a dealership located in a remote area. Additionally, the demographics of the surrounding area can also impact the blue sky value. A dealership located in an affluent area with a high population density is more valuable than a dealership located in a low-income area with a low population density.
If you are looking to increase the blue sky value of your dealership, consider relocating to a more desirable location. While this can be a costly endeavor, it can result in a significant increase in the value of your business.
Franchise
The franchise that a dealership is associated with can also impact the blue sky value. A dealership that is associated with a well-known and respected franchise is more valuable than a dealership associated with a lesser-known or less respected franchise. Additionally, the length of time that a dealership has been associated with a franchise can also impact the blue sky value. A dealership that has been associated with a franchise for a long time and has a good relationship with the franchisor is more valuable than a dealership that has only been associated with a franchise for a short time.
If you are looking to increase the blue sky value of your dealership, consider affiliating with a more desirable franchise. This can be a costly endeavor, but it can result in a significant increase in the value of your business.
Reputation
The reputation of a dealership can also impact the blue sky value. A dealership with a good reputation for quality service and fair pricing is more valuable than a dealership with a poor reputation. Additionally, the length of time that a dealership has been in business can also impact the blue sky value. A dealership that has been in business for a long time and has a good reputation is more valuable than a dealership that has only been in business for a short time.
If you are looking to increase the blue sky value of your dealership, focus on building a strong reputation for quality service and fair pricing. This can be achieved through effective marketing and advertising, as well as providing exceptional customer service to your customers.
Profitability
The profitability of a dealership is perhaps the most important factor that impacts the blue sky value. A dealership that is profitable and has a history of consistent profits is more valuable than a dealership that is not profitable. Additionally, the growth potential of a dealership can also impact the blue sky value. A dealership that has a strong potential for growth is more valuable than a dealership that has limited growth potential.
If you are looking to increase the blue sky value of your dealership, focus on increasing profitability. This can be achieved through effective cost management, increasing sales, and expanding your product and service offerings.
Tips for Increasing Blue Sky Value
Now that we have discussed the factors that impact the blue sky value of a dealership, let’s take a look at some tips for increasing the value of your business:
1. Focus on profitability: As we mentioned earlier, profitability is perhaps the most important factor that impacts the blue sky value. Focus on increasing profitability through effective cost management, increasing sales, and expanding your product and service offerings.
2. Build a strong reputation: A strong reputation for quality service and fair pricing can increase the blue sky value of your dealership. Focus on providing exceptional customer service and effectively marketing your dealership to build a strong reputation.
3. Consider affiliating with a more desirable franchise: If your dealership is associated with a lesser-known or less respected franchise, consider affiliating with a more desirable franchise. This can be a costly endeavor, but it can result in a significant increase in the value of your business.
4. Relocate to a more desirable location: If your dealership is located in a remote area or an area with low traffic and visibility, consider relocating to a more desirable location. While this can be a costly endeavor, it can result in a significant increase in the value of your business.
Conclusion
In conclusion, the blue sky value of a dealership is the intangible value of the business that cannot be measured by physical assets. The factors that impact the blue sky value include location, franchise, reputation, and profitability. If you are looking to increase the blue sky value of your dealership, focus on increasing profitability, building a strong reputation, affiliating with a more desirable franchise, and relocating to a more desirable location. By following these tips, you can increase the value of your business and ensure a successful sale when the time comes.
