You may ask: Is now the best time to sell my business? The answer is: it depends.
Roseville, Calif.- Is there ever a best time to sell a business? Quite possibly. Maybe if you have serious health issues and want to spend more time with family or other things, now is quite possibly the best time.
However, if you are not under compulsion to sell and are seriously considering selling your business but think the current economy and lack of financing and available buyers are a limiting factor, you might be pleasantly surprised.
For businesses that are not performing well and are in poor selling categories, like retail, then you may not be in a great position to sell at least for a historically good price. But, if you are one of the fortunate business owners to be performing fairly well in this environment and are cash flowing at a near six-figure income or above, then have I got good news for you.
We are experiencing multiple offers on good’ businesses for sale right now. There are by far more qualified buyers than there are good businesses for sale, and these businesses are not staying on the market long.
Financing
Are they getting financed? Yes and no. Traditional lenders are still tight as ever but, they are still doing loans, just with much more discretion. All the stars and planets must be in alignment; if there is seller carry, higher down payments, great credit, full collateral and industry experience then the deal can get financed. But this scenario is far and few between.
On the flip side, we are seeing many deals get done where the seller will carry a note. What this does for the seller is provide an ongoing annuity, provides more proceeds overall when factoring in interest, secures seller collateral in first position (not behind a lender), shortens the closing date, removes a major third-party hurdle from the transaction, may have favorable tax consequences when paying on income only when received and a buyer may pay more for the business.
What this does for the buyer is it gives them a sense of confidence in the business going forward successfully when the seller is willing to carry, they will have less closing fees which means more working capital available to ensure their future and they can get the deal done faster too.
Although the economy has led to unfavorable conditions, it now appears generally that things are stabilizing, and buyers have definitely come out of the woodwork. There is a shortage of good businesses on the market and generally these businesses will have held their value.
So, if you are considering the sale of your business it may be time to consult an expert in the field of business valuation and business sales. Right now you can contact Aron Culver, Managing Director of BTI Group in Roseville, CA, for a confidential conversation about your situation and receive a free opinion of value for your business through January, 2010.
BTI Group has sold more than 5,000 businesses since 1981. They say that any time is a good time to sell a good business as the trend has always been that there are more good, qualified buyers out there than there are good businesses for sale.
