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Number of Small Businesses Sold Increases, Sales Price Decreases
While the number of small businesses increased 8 percent, the sales price decreased to an average of $150,000.
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Billion-dollar companies aren't the only ones being snapped up by business buyers. According to a survey by BizBuySell.com, sales of businesses with annual revenues of about $350,000 increased 8 percent, from 1,106 in the second quarter of 2010 to 1,198 in the second quarter of 2011. This marks the highest number of small businesses sold since the fourth quarter of 2008."In tough economic times, many sellers are 100 percent focused on survival and performance improvement," Mike Handelsman, group general manager of BizBuySell.com and BizQuest.com, said in a company release. "But now their efforts have begun to pay off and their businesses are becoming profitable again. As such, many are finally ready to put their business on the market."
While the number of sales increased, the sales price of small businesses decreased, from $155,000 a year ago to $150,000 in the second quarter. The median asking price also dropped, from $249,000 to $239,000.
Median revenue of the businesses sold was also down: to $340,000 from $361,274 in the second quarter of 2010. Handelsman attributes the decrease in revenue to smaller businesses being sold, not to the decreasing health of the businesses.
Most of the small businesses sold were in the service sector, with 45 percent; followed by retail, with 26 percent; retail/restaurant, with 18 percent; "other" businesses, with 7 percent; and manufacturing, with 5 percent.
A significant factor in the increase in number of sales, said Handelsman, is availability of credit. "Businesses and business buyers are only now getting to the point where they can borrow money," Handelsman said. "We still expect it will take time for transactions to reach pre-recession levels, but headway is being made."
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Comments (Page 1 of 1)
So much for small businesses reviving the economy! You can’t revive an economy when Multinationals can produce products offshore with wages as low as 50 cents an hour with no benefits. America is being misled by politicians of both parties. The Republican claim that raising taxes on the rich (companies and individuals) will cost jobs. The truth is that there is no amount of tax breaks for companies that will induce them to produce products in the US when the can produce offshore at much lower wages and no environmental, safety, SS or Medicare payroll contributions. The Democrats keep harping on their social agenda to get elected while knowing that without a healthy economy they can’t pay for the benefits. Make products SOLD in the US suffer the same constraints as MADE in the US is the only hope of reviving the US economy. Tax breaks and stimulus programs only provide money to buy more offshore products.
Ed...these are SERVICE businesses, small ones...not what is being OUTSOURCED due to wages...the biggest problem THEY have is unknown costs of benefits (OBAMACARE) to employees and inflation, as well as threat of another recession....Wages in dollars are NOT the issue mainly in SERVICE businesses like the article describes...only for large call centers, etc with large volumes.....the USA lost manufacturing a long time ago due to Union demands for wages and benefits, and excessive US taxation and regulations.
Bob, I agree that most small businesses are not in trouble due to outsourcing. It is my contention, however, that most small businesses are in existence because of big businesses. As big business outsources, small businesses will decline. The engine for economic health is manufacturing. Its decline will affect all aspects of life in the US. Unless US laws are changed to apply to products SOLD in the US not just MADE in the US, manufacturing will continue to decline and our national financial health will continue to decline.
A congressman from Florida on one of the Sunday news shows said it sad that China is considered a better place to do business than the US. It is sad that such congressmen, or at least his predecessors have made law governing products made in the US and neglected to apply the same costs to offshore production. The US cannot, with technology or education, be competitive with 50 cents an hour wages in Indonesia or $14.00 for a 12 hour day in China.
The technology argument is a psychic out. Multinationals will apply the best technology where ever they operate.