In 2021, acquirers discounted purchase prices of dealers like you because of the run-up in commodity pricing. They claimed those prices couldn’t possibly continue, that these prices would drop back down to “normal,” and that the higher gross profit dollars and EBITDA were unsustainable.
Well, higher commodity prices did not settle down and stay there. They are climbing again with inflation, supply chain disruption, and COVID pressures. And they will remain in the upper ranges in 2022.
In this webinar, John Wagner of 1ST West M&A explains how sellers can defend higher acquisition values based on the higher gross profit dollars (and resulting higher EBITDA) that we saw in 2021, because they will likely continue in 2022. Live Q&A follows.