Business owners are surprisingly predictable when it comes to selling their companies. When revenues are rising, and money is cheap; they delay. This can have serious consequences when the market turns. Every business owner will exit their business someday. The decision to sell is often both personal and financial. The personal reasons can vary widely, but here are some proven reasons why you should consider selling right now:
- We are in a long-awaited Recession due in part to COVID-19.Signs include fluctuations and corrections in the stock market, yield curve inversion, trade wars and other factors.
- Not Selling Now could be a Significant Mistake. Significantly more buyers are in the market now due to COVID-19. We have access to banks that continue to finance transactions at reasonable rates.
- Sell Now, from a position of strength – Revenues and Earnings continue to be up in many businesses. However, one down year can cause a three-year delay. Now that COVID has ended, lenders understand that one-time reduction in revenue and profits as long as the sales & profits have come back.
- Capital continues to be readily available for businesses that are showing a strong profit.
- Capital Gains Taxes Remain Low
- Sale Prices & Multiples of discretionary earnings remain strong and Sellers are achieving 90%+ of Sales to Asking Price. Sellers might need to be more flexible, but Buyers are making offers and closing deals.
- Strategic Buyers, large and small, are well funded and continue to grow through acquisition.
- Buyer Demand continues to be extremely high with Sales Prices up over 2020 through 2022. Buyer inquiries at Sunbelt continue to break records.
- It is still a Seller’s Marketas buyers out-number sellers. However, this could easily change if the current recession continues to drag on.
- The SBA is Still Aggressively Lending – Buyers are able to purchase with as little as 10 to 15% down.
- Likelihood you will get an offer continues to be up significantly over the benchmark average.
- Closed Transactions are Up over last year and reached Record Levels in 2022 when Brokers reported the highest number of businesses changing hands since BizBuySell started tracking data in 2007. This growth continues to be credited to Baby Boomers who are reaching retirement age.
- Other Current Trends include Higher Offers for Companies with management teams in place, with reoccurring revenue, in growing industries and where there is obvious upside potential. The highest multiples go to the companies with the highest revenues and profits.
- Continued Optimism by both Buyers & Most Lenders makes this the Perfect Time to Sell Your business. Timing is Everything and Now is the Time!
At Sunbelt Business Brokers and Sunbelt Business Advisors closings are gaining momentum and average sale prices are up, driven by strong multiples, financing, and companies with strong earnings. There is no perfect time to sell, but the conditions are extremely favorable right now and the risks of waiting are growing. The Las Vega Office has direct access to buyers, acquisition professionals and a staff of others that can help seek out additional buyers specific to your industry. In addition, we have access to in house counsel and have strategic partnerships with private equity groups, lenders, mezzanine financing firms, tax professionals and M & A attorneys – all whom are experts in business transactions. If you are thinking about selling, now is the time to consult with Sunbelt Business Brokers, to be educated on what you can do to maximize your selling price and to help plan for an exit when the time is right for you.