31 Jan 2018 Record year for buying and selling small businesses
According to BizBuySell’s Insight Report, 2018 was the third year in a row in which business transactions, the buying and selling of businesses, increased. Over 10,000 businesses were bought and sold in the U.S. last year and the reasons seem pretty straight forward:
1. There is an increasing number of buyers and sellers out there. Baby Boomers are ready to retire and turn their independent businesses over to someone else; there are plenty of 30-somethings and 40-somethings ready to get out of the corporate 9-5 world and try something new and different.
2. The idea of owning a small business isn’t as scary as it once was. There are entire movements now around the ideas of “shopping small” and “buying local”. In fact, according to a recent American Express survey, in 2018 consumers spent an estimated $17.8 billion at independent retailer and restaurants on Small Business Saturday. Though it may seem ironic that a corporation like American Express would be the ones to create the #shopsmall movement, it actually makes sense. They want to support their independent retailer and restaurant customers and what better way than to make sure buyers are visiting those stores?
Similarly, the idea of “buying local” has grown as consumers learn the value that small businesses play in their community. Each small business provides jobs to locals and contributes taxes. They provide goods and services that consumers need and, by “buying local’ consumers in turn feel better about themselves. They’ve begun to realize that shopping local means they’re buying a meal from the restaurant owned by their down-the-street neighbors, not from a national conglomerate based thousands of miles away.
There’s more proof that the small business market is strong and growing stronger. In BizBuySell’s report they state that the median revenue of sold businesses in 2018 grew by 6.3% and the median cash flow increased 4.3%. That’s no surprise either when you consider that 93% of Americans told American Express they believe it’s important to support the small businesses they value in their communities.
Small businesses have a story to tell. That’s part of the reason we provide sellers the opportunity to tell that story through a business video interview. This gives interested buyers an opportunity as well – one in which they can learn about the business, its owners, and the company culture.
If you’ve decided it’s time to sell your business, or you’re ready to get out of the corporate world and be your own boss, we’d love to talk with you! Contact us here.