AutoNation COO Mike Maroone had a done deal when he met Arizona dealer Lou Grubb at an upscale restaurant in Scottsdale in early 1997.
Grubb, who is now deceased, had agreed to sell his dealership group to AutoNation -- then called Republic Industries.
But in the middle of dinner, tears started streaming down Grubb's face.
"He said, 'I came from nothing, I built this business. I know selling it is the right thing to do, but I never thought it would become a part of me. The business is like my brother,'" recalls Marc Cannon, AutoNation's senior vice president of corporate communications, who was at the dinner.
Maroone says he remembers it "like it was yesterday" because he could relate to Grubb's feelings.
"I had just gone down the same road," Maroone says. "I had five dealerships with 900 employees that I sold to Republic."
Such emotions can play as powerful a role in selling a dealership as dollars and cents do. For that reason, many brokers and buyers now recognize the importance of managing a seller's emotions. They hire trained people or train themselves to help sellers who have decided to sell their dealerships.
Sellers have common concerns, such as the fate of their employees, experts say.
"We hired an ex-dealer, Stu Lasser, because we realized we're only financial professionals," says Sheldon Sandler, founder of brokerage firm Bel Air Partners in Hopewell, N.J. "He has an understanding of not only operating a dealership but also the family dynamics. There is no question that we've done many deals, but part of it is being able to be a psychologist."
Brokers who consider a seller's psychological state also find it easier to recognize the signs that can precede cold feet, which could ultimately destroy a deal.
From deciding to sell a dealership to completing the transaction, the process can take a long time.
Lithia Motors Inc., for example, worked with a seller for 12 years before sealing the deal, says CEO Bryan DeBoer in Medford, Ore. Lithia is the nation's ninth largest dealership group ranked by 2012 new-vehicle retail sales units.
"It took us a long time to work through the opportunities that dealer had to resolve," DeBoer says. "I'm not there to push the guy's hot buttons. I'm there to satisfy his financial needs and succession needs."
Two dealers backed out of nearly done deals in the past few years, DeBoer says. "They were wonderful deals, but the owners decided it wasn't the right time for them to sell."
DeBoer is gracious when sellers back out, he says, hoping "they will reach out to us when they do choose to come back into the marketplace."
But to avoid broken deals, Lithia uses brokers in about three-fourths of its deals, DeBoer says.
Likewise, Sonic Automotive Inc. uses a broker on about half its deals. The broker helps bring a vetted seller to the table, says John Russ, Sonic's vice president of corporate development in Charlotte, N.C.
"The broker has to get them to that emotional place to sell," Russ says.