If you are thinking about buying or selling a business, the quarterly BizBuySell report is worth looking at. The information in these reports comes from a study of the sales and asking prices of about 50,000 businesses in the United States. The report gives information about sales prices and transactions that closed successfully. It also talks about the trends going on in the business for sale marketplace. No matter what you do in the business world, these trends are likely to affect you in some way.
It was a Seller's Market
According to the most recent BizBuySell report, which covers Q4 of 2021, now is a great time to sell a business. The fourth quarter of 2019 actually did better than the fourth quarter of 2019 before the flu epidemic. Obviously, this is a big change from the sales figures for 2020. Usually, sales of businesses drop in the fourth quarter, but 74% of brokers said that their sales stayed the same during this time. Experts say this strength has continued into the beginning of 2022.
Other important sales numbers:
- In 2021, there were 8,647 closed transactions, up from 7,612 in 2020
- Prices went up 16% from one year to the next
- The average cash flow went up 10% year over year
Quality is what Buyers Want
When asked what they are looking for in a business, 60% of buyers who were surveyed said that strong financials were a "must have" for them. This number is very different from the 18% of buyers who said that opportunities with discounts were the most important thing to them.
Lack of Workers is a Factor
The labor shortage was also talked about in the BizBuySell report. In fact, a survey of owners found that 64% of them have been affected. Most b usiness brokers agree that the biggest problem for small businesses right now is a lack of workers. Another related problem is disruptions in the supply chain, which 75% of the business owners who took the survey said had an effect on them.
A Better Balanced Buyer/Seller Landscape
In the survey, brokers were asked if they thought business owners were more likely to sell in 2022 or 2021. The general trend was for brokers to think that more businesses would be sold this year (2022) than last year (2021). People thought that buyers had the upper hand over sellers last year. But now, it seems like brokers think the situation has changed and become more balanced overall.
The report is issued 4 times per year and provides a high level view of the past quarters business for sale metris and statistics. It's published by www.bizbuysell.com, the worlds largest business for sale marketplace.
Copyright: ENLIGN Business Brokers, Inc.
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