The Business Transfer Newsletter
January 2022
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Selling Texas Companies Since 1974 |
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Our monthly newsletters provide educational information about buying or selling a business, current economic conditions, and highlight some of our newest business-for-sale opportunities. |
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Our monthly newsletters provide educational 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~
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Most firms offer a set of Business-for-Sale listings. Successful firms should also offer a long list of SOLD businesses. While our list doesn’t show all our transactions, it backs our claim that we sell more businesses than anyone else in Texas.
Buyers value your business based on risk (real or perceived) and future cash flow. Consider potential business risks. What could prevent your company from realizing your forecasted earnings? Think talent, customers, suppliers, competition, cash flow.
Strategize ways to reduce risk in each area, e.g. cross training, outsourcing, succession planning, customer diversification, backup suppliers, etc. The more you do to take away potential pain points, the more attractive your business will be.
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What is Seller’s Discretionary Earnings
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Calculating SDE is a way to standardize or “normalize” a company’s earnings so it can be more accurately compared to the earnings of other companies and the industry as a whole.
If you own a small to mid-size business, it’s important to have a good understanding of Seller’s Discretionary Earnings or “SDE” and how its calculated.
By doing so, you’ll gain a better understanding of your business’ true earnings, an accurate picture of its value, and insight on things you can do to enhance its value as you move forward.
This blog fully explains what SDE is and how it’s calculated. and finish by showing a real world example of how you can recast your financials to calculate your SDE.
Finish by using a real world example of how you can recast your financials to calculate your SDE.
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How to Buy a Business in 7 Steps on Our Website |
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FORBES
Is This the Right Time to Sell Your Business?
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After a challenging year, many business owners are calling it quits in 2021, but not for the reasons you may think. A surging economy, the prospect for rising taxes, and buyers flush with cash have created a perfect storm scenario for business owners looking to sell.
Competition for deals continues to grow
A growing number of buyers with cash on the sidelines has created significant opportunities for business owners ready to sell. According to a recent industry report, while the pace of recovery has varied among companies and sectors, and some have faced fundamental changes as a result of the health crisis, U.S. deal volume and value overall are up from 2020, with 2021 deal volume expected to outpace last year.
The potential for higher taxes is playing a role
While demand among buyers continued to grow throughout the pandemic, supply remained relatively low. Many owners of businesses that were adversely impacted by the pandemic were waiting to recover before selling. However, as more businesses reopened this year, many owners have seen a resurgence in business value due, in part, to pent-up consumer demand.
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Is 2022 A Good Year to Sell A Business |
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Between the high demand of businesses in the market, to labor shortages putting stress on small businesses, 2022 may just be the year to sell your business. If you are considering selling your business, be sure to contact one of our agents at Certified Business Brokers in Houston.
As the midpoint of the year passes, many business owners are re-evaluating their businesses. With uncertainties surrounding the economy and potential rises in taxes, it’s no surprise that business owners are leaning towards selling in the next year. So, is 2022 a good year to sell a business?
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- M&A and Business Brokerage Firm Since 1974
- Historically, we have sold >60% of the businesses we listed vs. 25% Industry Average
- Consistently sold businesses within 94.5% of appraised price
- We specialize and are experts in the Greater Houston, Texas market
- Closed approximately 3,000 business transactions in Texas
- We are NOT a franchise
- Authority on business transfer in our profession
- Founding Members of the International Business Brokers Association (IBBA)
- Founding Member of the Texas Association of Business Brokers (TABB)
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12141 Wickchester Lane, Suite 100
Houston, TX 77079
713-680-1200
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