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Powersports Business • September 2026 • 21

This matters even more in powersports because, for many dealers, the dealership represents 70 %– 85 % of their net worth. It’ s not just an asset. It’ s the asset that will largely determine whether you can retire the way you want, support your family, or transition confidently into the next phase of life.

A simple way to think about it: if you were the CEO of a public company, you’ d know your stock price every day. As a dealer, you don’ t need a daily number— but you do need a reliable valuation as part of planning. Otherwise, you’ re making big-money decisions— expanding the showroom, acquiring another store, adding new lines— without knowing how those moves may impact the future value of your largest asset.

BIGGEST EXIT PITFALLS Most exit problems don’ t show up at the closing table— they show up years earlier, in the form of avoidable blind spots.

One of the most common pitfalls is underestimating how exposed you really are when most of your wealth is tied up in the dealership. Buyers typically look at a three- to five-year history of financials( your P & L and balance sheet) adjusted for current market conditions. That means even one down year can materially impact goodwill. It’ s not just a tough year on paper; it can follow you into the transaction and reduce what a buyer is willing to pay.

Timing is another factor. We saw elevated valuations coming out of Covid, and today the market has normalized. If there’ s a disconnect between what an owner believes they can get and what buyers are paying today— and the owner isn’ t flexible on timeline. That can create real challenges.

Where we see the biggest risk, though, is lack of preparation. Many dealers may have an idea of what they could sell for, but they haven’ t done the“ walkaway” math: what they’ ll actually keep after taxes, fees, and deal structure. That net number determines whether the exit works.

We also see dealers go into a sale without a defined process. There’ s a saying we like:“ One buyer is no buyer.” Without a process, you limit your options, and you’ re exposed to whatever is put in front of you. Finally, buyers pay for confidence. If the owner is“ the dealership” and the business depends heavily on them, that creates risk in the eyes of a buyer and can impact value. The goal is to build a dealership that operates independently, with systems and the right people in place. And none of that matters if the financials aren’ t clean, organized, and defensible— because diligence problems often translate into price concessions.

IT’ S ABOUT WHAT YOU WALK AWAY WITH We hear it all the time:“ I got an offer for $ 10 million.” That’ s a great headline, but it’ s not the finish line.

What matters is what lands in your pocket after the deal is structured, taxes are paid, and the dust settles. As we discussed in the webinar, many dealers focus on the purchase price, but how the deal is structured can have just as much, if not more, impact on what you actually keep after taxes.

It starts with your corporate structure. Are you an S Corporation, LLC, or C Corporation? Those can be taxed very differently in a transaction, and in some cases( like certain C-Corp scenarios), there can be potential double taxation depending on how the deal is structured.

Then you look at how assets are organized. Is the real estate held separately from the operating entity, or combined? Those can be treated very differently in a sale. You may have one part taxed at capital gains rates while another portion is taxed as ordinary income.

And then there’ s the structure of the payout itself. Is it a full upfront sale, or is there seller financing? Those decisions can shift not just when you receive the money, but how it’ s taxed over time.

The key point is simple: you need to know the answers to these questions before you go to market. Otherwise, you’ re negotiating blind, because how do you know what to negotiate for if you don’ t know what you need to keep?

PLANNED VS. REACTIVE EXIT We see a dramatic difference between dealers who plan years in advance and those who react to an offer in real time, and it shows up in both outcomes and stress levels.

A prepared dealer operates with clarity. They’ ve likely gone through one or more valuations, so they understand what the dealership is worth in the eyes of the market, not just what they hope it’ s worth. They’ ve also opened communication early with their CPA and financial planner to estimate taxes and, more importantly, tie those numbers into a real financial plan so they understand what net proceeds can support after the sale.

They also tend to build a team that understands the powersports space specifically, and they create

See Matel & Stanek, Page 25