Q1 2009 Costs to Buy a Business
How Much Is My Niagara Falls Business Worth?
Every quarter, BizBuySell.com published business valuation data, and we now have their latest Niagara Falls, New York business-for-sale statistics.
Q1 2009 Business Valuations in Niagara Falls, NY
According to statistics issued by BizBuySell.com, Niagara Falls business-for-sale listings in Q1 2009 had a median asking price of $355,000.
That compares to a median ask price of $235,000 in Q1 2008. Because the median ask price for businesses for sale in Niagara Falls has risen year over year, we can conclude that many smaller firms in Niagara Falls are holding off on selling.
Please understand that this is the median asking price for a business. If you want to buy a business, you may be able to buy a Niagara Falls company for much less. Alternatively, some Niagara Falls businesses may be selling for much more.
Another thing to remember is that this is the asking price for a Niagara Falls business. When a small business owner lists a company for sale, they typically set a price that ends up being more than the contracted sale price. A sale-to-ask ratio typically might be between 0.85 and 0.90, but of course it varies considerably. So, a business listed for $100,000 might sell for between $85,000 and $90,000.
Number of Niagara Falls Businesses for Sale in the Dataset
The study data comprised 28 listings in the Buffalo-Niagara Falls, NY metro area. As such, some of the businesses used to derive the median valuation might be outside of Niagara Falls, but they are close by and so are probably representative of Niagara Falls business valuations.
One year ago, in Q1 2008, the BizBuySell.com dataset for Niagara Falls spanned 103 listings. In a market where you would think fewer business owners would be selling, it's a bit surprising to see more Niagara Falls business-for-sale listings.
Q1 2009 Revenue Multiples In Niagara Falls, NY
In the Buffalo-Niagara Falls, NY metro area, businesses will usually sell for 1.01 times the selling company's revenues. This was the mean revenue multiple for Q1 2009 in this area of the country.
In other words, a firm with revenues of $200,000 might list for $201,953. Remember, however, that this is only an average for revenue multiples in the area. Some businesses will have higher revenue multiples and others will have lower revenue multiples.
According to BizBuySell.com, the median revenues for its business-for-sale listings was $435,000 in Q1 2009.
To put this in perspective, the Q1 2008 revenue multiple was 0.73 and the median revenue for listed businesses was $550,000.
Q1 2009 Cash Flow Multiples In Niagara Falls, NY
Cash flow multiples are another common way to value a business.
For Q1 2009, the average cash flow multiple for listed businesses in the Buffalo-Niagara Falls, NY metro area was 3.52.
So, a company with cash flows of $150,000 might have an asking price of $527,778. That's only if the firm complies with the local average. Cash flow multiples will usually vary considerably based on many factors.
In case you were wondering what typical cash flows are for a business in Niagara Falls, BizBuySell.com reports that the median cash flow for Niagara Falls area businesses was $98,500 in Q1 2009. In Q1 2008, cash flow multiples clocked in at 3.77 and the median cash flow was $83,000.
Things to Consider When Selling a Business in Niagara Falls, NY
Buyers pay more for certainty than for uncertainty, especially when it comes to future cash flows. So, think about ways to lock in future cash flows for a prospective buyer and, if it can be done, you'll then be able to command a higher sale price for your business. This useful tip for selling a business comes from Domenic Rinaldi, managing partner of Sun Acquisitions, a leading business brokerage firm.
Business Valuations for Niagara Falls, NY Businesses
If you are contemplating buying a business or selling a business and would like to look at comparables in the area, we suggest you try the BizBuySell.com Business Valuation Tool. You can modify the dataset that creates business valuation estimates to meet your specific criteria. As a bonus, access to the tool is very affordable -- less than $100.
More Information on BizBuySell.com's Quarterly Reports
The BizBuySell Insight Report is a nationally-recognized economic report that tracks trends in the business-for-sale marketplace. If you find these trends interesting, take a moment to visit BizBuySell.com Insights Report for additional information.
Historical Data for Niagara Falls, NY Business Valuations
If you are interested in trends in business-for-sale asking prices, here are the median asking prices for businesses in the Buffalo-Niagara Falls, NY metro area for the last 9 quarters.
Here is how median revenue multiples are tracking in the Niagara Falls area, based on BizBuySell.com's quarterly reports.
The table below shows how cash flow multiples are trending in the Niagara Falls area, based on BizBuySell.com's quarterly reports.
Flow Multiple
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