Selling a moving company in Canada

An owner who has decided to sell a moving company has a sequence to follow: prepare the records, settle how the carrier registration and the crew will carry over, control who learns about the sale, and then meet buyers. BDC’s guide to selling a business says many people underestimate how long preparation takes, particularly when there are issues to fix first. A moving company adds its own questions, such as which licences and registrations sit with the company, what happens to the crew, and who in the business holds the referral relationships. This guide covers those in order.

Start with the records a buyer will request

BDC lists an accountant’s help with year-end and interim statements and projections, and a lawyer’s help supplying information in due diligence. For a mover, add items the financials will not show: a fleet list with each truck’s registration, a record of complaints and damage claims and how each ended, the storage lease if you operate a facility, and a summary of where bookings come from. Gather these before you tell anyone you are selling. Doing so shows you where a buyer may push back, and gives you time to fix a weak point instead of explaining it under pressure.

Know where your carrier registration sits

Carrier registration is held with a regulator, so ask early whether it can pass to a buyer at all. Ontario’s CVOR page describes the operator as the person or corporation responsible for the operation of the commercial motor vehicle, driver and goods or passengers. Alberta’s page says a carrier whose corporate name changes must amend the name on its Safety Fitness Certificate, and that a change in operating status may require compliance with different regulatory requirements. Transport Canada says extra-provincial carriers are federally regulated, and that the Motor Vehicle Transport Act allows provinces and territories to regulate them on behalf of the federal government. Ask your lawyer whether the sale structure keeps the registration in place or means the buyer must apply, and read whether a share purchase avoids transferring licences.

Decide who will advise you

BDC’s guide describes several kinds of help: an accountant for statements and projections, a lawyer to negotiate the purchase agreement and handle legal issues, a banker who can fund vendor financing or investments that make the business more attractive, a strategic advisor who helps prepare the business and structure the transaction, and specialized advisors who address specific issues in the company. You do not need every one, but settle who does what before the first buyer calls. BDC adds that, depending on a company’s size, buyers can be found through a business broker for smaller businesses or an investment banker for larger ones.

Plan for the crew

Settle your approach to the crew early. British Columbia’s Employment Standards Branch explains that, when all or part of a business is disposed of, the employment of an employee of the business is deemed continuous and uninterrupted for the purposes of that province’s Act. Other provinces run their own rules, so confirm how yours treats employees on a sale. Decide who among your lead movers and dispatchers a buyer may want to meet, and talk to your lawyer before sharing names or pay details. The question to settle is how those people will be told, and when.

Keep the sale confidential

Consider how customers, crews and referral partners would react to news of a sale before a buyer is committed. Ask your lawyer for a confidentiality agreement that a prospective buyer signs before seeing customer lists, crew details or claims history. Share the least detail that lets a buyer assess the business, and stage the rest as the deal progresses. Decide in advance who in your office knows, and what you will say if a realtor or corporate account asks directly.

Decide how much you will stay involved

BDC’s guide says buyers may insist on a reduced price if the owner cuts all ties, and describes a full cash-out as one where the buyer takes on more risk because the seller is no longer involved. Referral relationships in a moving company may rest on the owner, so consider offering a transition period, introductions to your main referral sources and time to train a successor. Put the length and the pay for that role in writing before you accept an offer, not after.

• Assemble statements, fleet files, claims history and your lease before approaching buyers.
• Ask your lawyer how the carrier registration is treated under an asset sale and a share sale.
• Prepare a plan for telling the crew and your main referral sources, with timing.
• Use a signed confidentiality agreement before releasing customer or crew detail.
• Agree in writing how long you will stay and what you will be paid.