Why Now Could Be a Good Time to Sell the Business

7:50 pm Business Planning

Yesterday’s Wall Street Journal noted that now may be a good time for business owners who may have struggled before to sell a business due to the weak economy to give it another go.

Data from online small business marketplace BizBuySell.com shows that 1,685 small businesses were sold during the third quarter of this year compared with 1,189 during the same time period last year – the third year-over-year quarterly increase in a row:

MK CH281 SBSELL NS 20131023174507 Why Now Could Be a Good Time to Sell the Business

Most of the sales have come from service companies, followed by retail and restaurants.  Small business lending is also on the rise, with the SBA backing $5.3 billion in loans during the third quarter of this year versus $4.3 billion in the third quarter last year.

According to the WSJ article, business valuations have risen with the improving economy, making what would have been a difficult sale just three years ago more attractive to investors now.  Banks and buyers typically look at the latest three years of revenue when assessing a deal.

Timing is critical, however; commercial lease rates are on the rise, which could hamper business sales for baby boomers looking to cash out and retire.

If you are looking for a business exit strategy that will help provide a good financial future for you and your family, contact our Newport Beach law firm.

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