by Jerry Bazata
Perhaps one day you hope to sell your entertainment business and retire. Naturally you would hope that after all your years of hard work, a full booking calendar and a positive reputation in the market, that the sale can produce a golden road to retirement.
The most important question that will determine if your company will sell is “Does it depend directly on you?” If the answer to that question is “YES!”…It may be unsellable. If YOU are the key ingredient to generating revenue, then the value of that business is limited to tangible assets such as the DJ equipment you own.
Meet Mr. Smith
Let’s illustrate this principal: Mike Smith of Mike’s DJ Music started his mobile DJ business in 2001. He has nearly 1,000 bookings a year because of his referrals and his creative marketing plan. Clients love Mike’s work and he does a variety of different events including weddings, corporate functions and school dances. Satisfied clients quickly spread the word with testimonials on wedding search engines, Facebook and his website.
Mike decided a few years ago to bring another DJ onboard to help with his workload; however, many prospects only want to hire Mike for their events. The other DJ is underutilized and unhappy about it.
The process of making your DJ business sellable beyond the value of the equipment and less dependent on you as been referred to by some experts as “you proofing.” Multi-system operators attempt to do this by identifying the services that can be sold without the owner’s personality being a key factor.
In addition, do the business relationships (e.g., photographers, caterers, banquet managers, etc.) identify the success of the company based upon its reputation as a whole or based soley on their relationship with the owner?
It’s very difficult to place a dollar value on an intangible asset, often referred to as goodwill. The goodwill is what you personally created in the growth of your business with vendors and clients and it is often difficult for someone to come in and replicate that success.
Jerry Bazata – Money Answer Man
Jerry Bazata has over 25 years of experience as a professional mobile entertainer. He is the owner of DJ Jaz Music and Entertainment, and J & J Marketing and Entertainment, a leading consultant to the event planning and music industries. Jerry is also a Vice President in the Global Commercial Bank-Business Banking Group of a global financial institution.
He has been a featured speaker numerous times at the International Bar & Restaurant Show in Las Vegas and the International DJ Expo in Atlantic City. Jerry’s charismatic, humorous and down-to-earth style allows attendees to get educated in an entertaining manner. He provides guidance and inspiration to help DJ business owners achieve their financial goals.
Additionally, Jerry has authored countless articles about financial and marketing success strategies that have appeared in a DJ Times Magazine and financial publications. His insights and forecasting abilities are second to none.
Jerry is a graduate of Sacred Heart University in Connecticut. He holds Bachelor of Administration Banking and Finance, and Bachelor of Administration Marketing degrees as well as an American Institute of Banking Sales Management and Theory Degree.