Business-For-Sale Market Heats Up

Business-For-Sale Market Heats Up

So writes Angus Loden at The Wall Street Journal blog In Charge: On the challenges of entrepreneurs managing their businesses.

Sales of small businesses rose 8% in the second quarter over the same period last year, hitting the highest level since the closing months of 2008, with a growing number of smaller firms finding buyers, according to business-broker data.

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From April to June, sales of 1,198 small businesses on the market closed, up from 1,106 in the second quarter of 2010, according to BizBuySell.com, an online small-business marketplace based in San Francisco.

The median sale price last quarter was roughly unchanged at $150,000, with sales ranging from restaurants and stores, to manufacturers and other services. Buyers paid a median of $25,000 below asking prices, the report showed.

While the overall number of sales increased, the median revenue of businesses sold dropped by 6% to $340,000 from $361,274 last year. The decline suggests smaller businesses were being sold, according to BizBuySell general manager Mike Handelsman.

Handelsman said the upturn is likely the result of latent sellers waiting for signs of business performance to improve before going to market. It also reflects a slight thawing of capital markets, along with an increase in seller financing, he said.

Read the whole article here.

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