Moreover, Reagan Consulting is now seeing more sellers and buyers come back to the marketplace, just as many economies restart across the United States.
“There are still a good amount of firms coming to the marketplace, there’s still a lot of demand from the buyer community, and valuations are still holding for quality premier assets,” explained Brooks. “For lower quality assets, what we’re seeing is sometimes a slight tweak to deal structures.”
For example, a buyer might negotiate a deal whereby they give the seller a portion of the cash up front and hold the rest back for a year until the business can prove that it can survive and thrive through COVID-19.
During the Insurance Connect Texas keynote panel on July 21, Brooks will divulge three key pieces of advice for agencies aiming to grow their businesses. First, he says, agency leaders have to understand their operations and the best practices in the industry, and then determine if they’re operating in the most efficient way possible. To assist in this, the Reagan Consulting team has “deep knowledge of benchmarking, and what an agency’s expense structure and revenue structure should look like for the best peers in a size category,” noted Brooks.
He also plans to address agencies’ approaches to talent recruitment and development during the panel.
“If you’re going to prosper and supercharge your agency’s growth, you have to have the right talent and people driving the organization,” he said. “I’m going to talk about how you attract youth and diversity into the organization, [as well as] how you attract proven and experienced insurance producers.”
Finally, Brooks will capitalize on his years of experience focusing on deal-making in the insurance industry to explore how agencies can optimize their M&A strategies, whether they plan on buying a firm or partnering with another agency to provide them with additional tools and resources.
One important component of an M&A strategy is finding business partners that are on the same page, explained Brooks.
“The agency that you’re either buying or selling to, do they have similar values and a similar culture? It’s extremely important – we’re a people business, so you have to have alignment,” said Brooks.
Insurance Connect Texas attendees will be sure to get a lot of useful takeaways from the panel and Brooks’ insight, considering that Reagan Consulting does over 100 agency valuations every year.
“We have deep insights into agency valuation, and we do more large, complex and diversified transactions than pretty much any other firm in our space,” said Brooks, adding that his insight will offer a look behind the curtain of insurance agency deal-making. “There’s a lot of noise in the marketplace and I’m able to bring some truth and clarity [on] what exactly are the valuations that are happening in our space, and what does the merger and acquisition landscape look like.”
To learn more about how to supercharge your insurance agency business and to sign up for Insurance Connect Texas, hosted on July 21, click here.