Q1 2009 Costs to Buy a Business
How Much Is My Orlando Business Worth?
We just received the latest Orlando, Florida business valuation data for First Quarter 2009.
Q1 2009 Business Valuations in Orlando, FL
According to statistics issued by BizBuySell.com, Orlando business-for-sale listings in Q1 2009 had a median asking price of $194,000.
That compares to a median ask price of $190,000 in Q1 2008. Since the median ask price for businesses for sale in Orlando has gone up year over year, we can conclude that many smaller businesses in Orlando are putting off 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 Orlando company for much less. However, some Orlando businesses may be selling for much more.
Also, this is the asking price for a Orlando business. When an entrepreneur lists a business for sale, they typically set a price that ends up being more than the eventual 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 Orlando Businesses for Sale in the Dataset
The study data comprised 887 listings in the Orlando-Kissimmee, FL metro area. Many of the businesses in the dataset are outside of Orlando, but they are in the area and so are likely representative of Orlando business valuations.
One year ago, in Q1 2008, the BizBuySell.com dataset for Orlando spanned 940 listings. The downward trend in the number of Orlando business-for-sale listings is indicative of the current down economy.
Q1 2009 Revenue Multiples In Orlando, FL
In the Orlando-Kissimmee, FL metro area, businesses will usually sell for 0.89 times the selling company's revenues. That was the mean revenue multiple for Q1 2009 in this area of the country.
In other words, a business that has revenues of $200,000 might list for $178,926. Remember, however, that this is just an average for revenue multiples in Orlando and surrounding communities. Some entities 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 $326,860 in Q1 2009.
To give this some context, the Q1 2008 revenue multiple was 0.86 and the median revenue for listed businesses was $322,834.
Q1 2009 Cash Flow Multiples In Orlando, FL
Cash flow multiples are another common way to value a business.
For Q1 2009, the average cash flow multiple for listed businesses in the Orlando-Kissimmee, FL metro area was 3.05.
So, a firm with cash flows of $150,000 might have an asking price of $457,157. That's only if the firm complies with the local average. Cash flow multiples will usually vary considerably based on many factors.
If you are interested in what cash flows are for a business in Orlando, BizBuySell.com reports that the median cash flow for Orlando area businesses was $82,812 in Q1 2009. In Q1 2008, cash flow multiples clocked in at 2.98 and the median cash flow was $83,519.
Tips for Orlando, FL Business Sellers
Don't assume that the price you initially negotiate with a buyer will stay the same all the way to closing. During due diligence, the buyer may find some blemishes on the businesses that lead them to lower their offer. This is a natural part of the process and should be expected. This helpful business selling tip comes from Domenic Rinaldi, managing partner of Sun Acquisitions, a leading business brokerage firm.
Business Valuations for Orlando, FL Businesses
If you are contemplating buying a business or selling a business and would like to find out how much a business is worth, 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 published every quarter. If you find these trends interesting, take a moment to visit BizBuySell.com Insights Report for more information.
Historical Data for Orlando, FL Business Valuations
If you are interested in trends in business-for-sale asking prices, here are the median asking prices for businesses in the Orlando-Kissimmee, FL metro area for the last 9 quarters.
Here is how median revenue multiples are trending in the Orlando area, based on BizBuySell.com's quarterly reports.
Here is how cash flow multiples are trending in the Orlando area, based on BizBuySell.com's quarterly reports.
Flow Multiple
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