How do I prepare my travel agency for sale?

Buyers of travel agencies look hard at two things: whether the income is real and whether it stays after you leave. Preparation is about answering both with paper. Start early, because some of the steps, such as moving clients to your advisors, take months, and a buyer will ask about them in the first conversation.

Organize your commission records

Pull together supplier and host statements and match them to your bank deposits and your books. Break the income down by advisor, supplier and season. A buyer’s accountant will do this anyway, and a clear set from you shortens the process. Your accountant can help you tidy the records before anyone sees them.

Read your host or consortium agreements

Find out whether your agreements with a host, consortium or franchisor can pass to a buyer, and whether the group must approve the new owner. Ask your lawyer to read them with you. If approval is needed, speak to the group early and quietly, since a buyer will want to know before committing.

Schedule future bookings and loosen your hold on clients

Prepare a list of travel already booked with the commission still to come, and decide with your lawyer how it will be split at closing. Then consider whether to shift key client relationships to your advisors so the agency does not rest on you alone. Buyers read closely how much of a travel agency’s business leaves with its advisors closely.

• Statements by supplier and host, tied to the books.
• Income by advisor and by season.
• Host or consortium agreements and what they say about a sale.
• Future bookings with commission still to come.