The Details: BizBuySell.com's Second Quarter 2019 Insight Report shows a dip in small business...
Small Business Transactions Reached Record Highs in 2017, Up 27% from 2016
The Details:
According to a recent BizBuySell.com report, a record number of small businesses changed hands in 2017, up 27% from 2016. There were 9,919 transactions closed in 2017 compared to 7,842 in 2016. This year-over-year growth rate is the largest since 2013.
“The economy is in a good position,” says Bob House, president of BizBuySell.com. “A lot of Baby Boomers are ready to sell, and a lot of buyers are optimistic about the future.”
Nationally, the median revenue of sold businesses grew 5.8% from $472,798 in 2016 to $500,000 in 2017. Median cash flow also increased, up almost 7% to $115,000 from $107,551 the year prior.
Key Takeaways:
According to the BizBuySell survey of over 5,000 business brokers, when asked for the top reasons for the increase in transactions, brokers cited:
- Improving small business environment, including strengthening revenue and profit numbers (28%)
- Increasing number of owners looking to sell (21%)
- Increasing number of qualified buyers on the market (19%)
58% of surveyed business brokers credited more than half of their 2017 sales to Baby Boomer owners.
The Bottom Line:
80% of business brokers expect the number of business sale transactions to increase again in 2018. Owners looking to sell soon need to be ready to take advantage of this favorable market by preparing their businesses for sale. The best way to maximize business value, achieve your goals, and increase the likelihood for a successful business transaction, is to be prepared.
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ABOUT BTA
Our mission is to assist the owners of privately held companies in making key transition decisions that impact their future as well as the future of their businesses, families, and employees.
As a business owner and co-founder of BTA, Jane Johnson recognized the need to educate business owners about the importance of planning ownership transitions to achieve their goals and ensure business continuity. The challenges Jane experienced with selling her own business inspired her to co-author the book Cashing Out of Your Business – Your Last Great Deal and develop tools and resources to inform and empower other owners to plan and execute successful ownership transitions.