Certified Business Brokers
The Business Transfer Newsletter
August 2016
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Family Businesses, Jobs Seen Thwarted By Proposed IRS Rules





Even The Startup Trying To Disrupt Healthcare Can't Figure Out Obamacare




Oh, You Thought Your State Government Worked For You?



Tech Is Primed For An Upswing: It's An Ideal Time To Be Building Products





M&A Continues At Healthy Rate 






The Secrets Of Keeping A Family Business Going For 500 Years






5 Signs You Aren't Meant To Be An Employee






 Conquering The 3 Most Common Types Of Company Crisis 






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The CBB Advantage:

M&A and Business Brokerage Firm Since 1974

Close  >60% of the businesses we list vs. 38% Industry Average

Consistently sold businesses within 94.5% of appraised price

We specialize and are experts in the Texas market.

Closed approx. 2,000 business transactions In Texas.

We are NOT a franchise

Authority on business transfer in our profession

Founding Members of the International Business Broker Association (IBBA)

Founding Member of the Texas Association of Business Brokers (TABB)

Selling Texas Companies Since 1974


Our monthly newsletters provide information about buying or selling a business, current economic conditions, and highlight some of our newest business-for-sale opportunities.


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"The best library of articles about how to sell

your business "..... says The New York Times

Businesses For Sale

    Review All Listings                         Manufacturers For Sale 

    Wholesale / Distributors                 Service Businesses For Sale 

    Auto-Related Businesses                Child Care Centers For Sale   

                          Restaurants - Fast Food - Bars 



Featured Business Listing

* Featured Restaurant Listing 


Market Pulse Survey Results - 2nd Quarter 2016
The quarterly IBBA and M&A Source Market Pulse Survey was created to gain an accurate understanding of the market conditions for businesses being sold in Main Street (values $0-$2MM) and the lower middle market (values $2MM -$50MM). The national survey was conducted with the intent of providing a valuable resource to business owners and their advisors. The IBBA and M&A Source present the Market Pulse Survey with the support of the Pepperdine Private Capital Markets Project and Pepperdine Graziadio School of Business and Management.
The Q2 2016 survey was completed by 378 business brokers and M&A advisors, representing 38 states. Respondents completed 409 transactions this quarter and over half (55%) had at least 10 years of experience in the industry.  *Certified Business Brokers (CBB) was a contributor to this survey.


According to the Market Pulse report, SMALL MANUFACTURERS grossing between $1 million and $50 million per year were the number one sellers of businesses during this past quarter, beating all other industries including distributors and service firms.
Owners of RESTAURANTS and SERVICE FIRMS were the biggest sellers of any industry grossing less than $500,000 and $1 million per year, respectively.

If you're an American manufacturer, this may not exactly be the time of a "manufacturing renaissance" as this year's presidential candidates like to talk about.  Instead, it may just be a good time to sell your business.

CURRENT EVENTS: Presidential Election . Like many Americans, business brokers and M&A advisors are keeping a close eye on the presidential election. As the race is officially between Donald Trump and Hillary Clinton, Trump may benefit from public confidence in his position on economic issues. In the latest Market Pulse survey, advisors overwhelmingly agreed that Trump (68.3%) would be the more business-friendly president than Hillary Clinton.
While an important component to consider, advisors ranked the upcoming presidential election third in a list of four factors that could be impacting the current marketplace. Lack of quality sell-side opportunities (49% Main Street, 43% lower middle market) led among pivotal market factors, followed distantly by low interest rates (30%, 28%), the presidential election (14%, 17%), and the lagging stock market (8%, 12%).
"We see close similarity in how both Main Street and lower middle market advisors ranked these economic factors," said Craig Everett, PhD, Director of Pepperdine Private Capital Markets Project. "Even though these sectors have different experiences in terms of deal volume and seller leverage, they're still reporting a consistent view on larger market trend issues."
Brexit. Meanwhile, following Britain's vote to leave the EU, advisors anticipate that activity from foreign-born buyers will increase, but that Brexit will have little impact on domestic buyers and sellers. Notable for individual buyers (who are primarily Main Street buyers), more than one-third of business brokers report that the number of foreign-born first time buyers has increased in 2016 (36% reporting an increase vs. 59% reporting no change). Other first-time buyer categories showing growth signs include former corporate executives and buyers under 40. Buyers under 30 and women buyers remained relatively unchanged in the first half of 2016. 


Main Street 
($0 - $1M Business Value)

Lower Middle Market

($2 - $50M Business Value

1. Restaurants

1. Manufacturing

2. Services - Personal

3. Consumer Goods / Retail

2. Consumer Goods / Retail and

    Construction / Engineering (tie)


WHY ARE OWNERS SELLING? Retirement continues to lead as the number one reason across all sectors, followed most often by burnout and new opportunities.

Year after year, advisor confidence in a seller's market is steady or increasing across all market sectors. Businesses in the smallest market sector (which represents roughly half of all businesses sold this quarter) are positioned in a buyer's market. Advantage shifts, however, as deals exceed $1 million in value. In the lower middle market, seller advantage sentiment is strong yet remains 3 to 8 percentage points below peak since the Market Pulse survey began in 2012.

Multiples continue to remain strong in all categories. As Main Street seller advantage sentiment continues to improve, we're seeing a rare jump in median values for the smallest market sector, increasing from 2.0 to 2.3 for the first time in years. Main Street businesses sold for approximately 92.5% of their asking price in Q2 2016. This reflects a slight improvement for businesses valued at less than $500,000. Meanwhile, businesses in the lower middle market-which typically aren't marketed with an asking price-received 98% of the internal benchmark set by the advisor and seller.

Sellers continue to get the majority cash at close. In this quarter, owners got 76% or more cash at close with the majority of the balance being seller financing, along with some earn outs to close the valuation gap. Seller financing amounted to at least 10% of financing across all market segments.
Buyers continue to use seller financing as a tool to lessen the equity they have to bring to the table. But more importantly, seller financing keeps the seller engaged after a sale. Payments are typically made over a two to five-year period, so even if the seller doesn't continue to work in the business, they will still do what they can to help the buyer succeed. It's a big carrot to keep the seller vested in the future success of the business.

Active buyer types have remained relatively the same quarter over quarter. In the smallest deal category (businesses valued at <$500K) first time buyers accounted for the largest buyer segment. In the largest deal category (businesses valued between $5 million to $50 million) private equity made up the largest buyer group. Individual buyers accounted for only 17% (13% first time buyers, 4% repeat owners) of the larger sector.

Typically, buyers are sourced from a wider geographic area as deal size increases. This quarter presented something of a surprise as highly localized buyers (within 20 miles) represented the largest buyer pool for businesses valued at $2 million to $5 million.

Buyers in the Main Street market are most often motivated by a desire to buy a job. That is, the seller is looking to leave corporate America and be active fulltime in the business. Buyers in the lower middle market are more often expanding an existing business through a horizontal or vertical add-on.


"We know that good markets don't last forever," said Scott Bushkie, Chairman of the International Business Brokers Association.
"We're in the second longest bull run, only behind the bull run of the 1990s leading up to the dot.com crash. We have to assume market conditions will shift, but whether that's six months or three years from now is anyone's guess."

Memorable Landscapes

Lars Langerud (Buyer), John & Barbie Wolf (Sellers), Peggy Tate (CBB Broker)


This commercial landscape maintenance company has been delivering high quality, consistent service to commercial property owners in the Houston area since 1989. After many years in the commercial landscaping business, the seller was ready to try something different, something that did not involve the responsibly for managing employees. He's going into commercial insurance.


The buyer already owns a thriving commercial landscaping business into which he occasionally merges smaller landscaping companies, which boosts his growth. The buyer and seller really hit it off and going forward, plan to actively assist each other in growing their respective businesses.


The business was sold within three months of going to market at 96% of asking price. Frank Stabler listed the business and Peggy Tate sold it.  

American Family Group - Allstate Insurance

Tony Homsi (Seller), Warren Rotto (Buyer), Ryan DeGennaro (CBB Broker)

This well-known nationally branded insurance agency in Houston is ranked among the top four agencies in the U.S.  It provides auto, real estate, business, life, and other insurance products.  The owner is moving out-of-state, which necessitated the sale of the company.
The buyer was already a licensed agent practicing privately in the commercial space, but wanted to expand into retail markets.  This business was the perfect opportunity.
This business took 10 months to sell, but it sold at 100% of listing price.
Ryan DeGennaro listed and sold the business.
Bella Nova Day Spa & Wellness

Julie Puccio (Seller), Terence Freeman (Buyer), Marcia Bowron (CBB Broke)

This award-winning Houston Day Spa, Medspa and Fitness Center provides a niche between spa/beauty treatments and med spa services. The seller was a merchandise manager for Foleys and when Macys acquired Foleys, she took a severance package and opened Bella Nova 10 years ago. Ready to spend more time with her family and teenage children, she decided to sell the company.

Buyer Terence Freeman has been a big consumer of spa services in the past and has had experience in restaurant management and most recently HR in the corporate world. He only looked for about a month before finding Bella Nova.  He plans to remodel a bit and bring in new med-spa services. His spouse is an OBGYN and will be the doctor of record saving the fees Bella Nova currently pays to their Doctor of record. 

The business was sold within two months of going to market at 94% listing price. Some seller financing was part of the transaction.

Marcia Bowron listed and sold the business.
Ask The ExpertsQuestion Ask The Experts


Why is seller financing important to the sale of my business?
If your business is not financeable by SBA Lenders, in most cases, businesses that are listed for all cash just don't sell!
Surveys have shown that a seller who asks for all cash, receives on average only 70% of their asking price, while sellers who accept terms receive on average 86% of their asking price. That's a difference of 16%!  In most cases, businesses that are listed for all cash just don't sell. With reasonable terms, however, the chances of selling increase dramatically and the time period from listing to sale greatly decreases. Most sellers are unaware of how much interest they can receive by financing the sale of their business, while at the same time paying capital gain taxes over time.  In some cases it can greatly increase the amount received. And again, it tells the buyer that the seller has enough confidence that the business can, indeed, pay for itself.

Texas Economic News

We watch economic and market conditions compared to the rest of the country because these factors affect business value. The following articles were all published since our last newsletter.


Texas Won The Olympics - Texas Monthly


Top 10 Cities With The Fastest-Growing Businesses - Austin #5, Houston #7, Dallas #8
California Wine Is An Economic Engine For U.S. - As a wine lover, I'll toast CA for that

Texas Association of Business Brokers - Houston Chapter  International Business Brokers Association M&A SourceACG LogoTexas Restaurant Assocation Logo