A Good Time To Sell A Business?

A few weeks ago the Wall Street Journal published an article on its online edition (Finally, A Good Time To Sell The Business, October 23, 2013), citing several indications that the market for sale of small businesses, gone missing the past five or so years, has returned.  Noted in the article are the following statistics:

–  Bizbuysell.com reported 1,685 small businesses sold between July and September of 2013, up from 1,189 sold during the same period of 2012 (a more than 40% increase);

–  BizEquity.com reported an increase in median valuation for businesses from $860,000 third quarter 2012 to $1,300,000 third quarter 2013

–  12,976 SBA 7(a) loans totaling $5.3 billion guaranteed third quarter 2013, compared to 11,442 loans totaling $4.3 billion third quarter 2012

–  Wells Fargo SBA lending reported a 12% increase in loans closed year-to-date through September 2013, compared to the same period in 2012

The recession left many business owners unable to sell their business for the past several years, when they might otherwise have desired to retire.  Fortunately, many of those businesses not only survived, but have recovered well, and are now in a position to demand a fair price in the market.  With two to three years of strong profits history, many businesses will qualify for buyer financing through SBA-guaranteed or even conventional loan programs.   Availability of lender financing to buyers means a larger pool of prospective buyers for those business owners who are not interested in providing seller financing.

If you are considering whether the time is right to sell your business and retire, or perhaps to pursue other interests, the professionals at Piedmont Business can help you with the analysis.  The time may be now, or perhaps after a year or two of further positioning, but for now the prospects for selling a business are looking up – finally!