Buying a Business
Cost to Buy a Business in East Hartford
Considering purchasing a company in East Hartford, Connecticut? You're no doubt wondering how much a typical East Hartford, Connecticut business costs to buy.
Fortunately, the folks at BizBuySell.com have made some data available on what it costs to buy a business in East Hartford.
BizBuySell.com is the biggest business-for-sale listings site on the Internet, offering over 50,000 businesses for sale at any given time. Their listings include almost all of the available listings from business brokers nationwide. They also have many FSBO (for sale by owner) business-for-sale listings.
If you are looking to buy a business in Connecticut, check out the BizBuySell Connecticut listings to see the latest business-for-sale listings for East Hartford and other Connecticut municipalities.
Business Valuations in East Hartford, CT
According to BizBuySell.com, the median asking price for an East Hartford business-for-sale listing in Q4 2008, the quarter when they most recently released their data, was $179,500.
That was based on 206 listings in the Hartford-West Hartford-East Hartford, CT metro area. As such, some of the businesses used to derive the median valuation might be outside of East Hartford, but they are nearby and so are probably representative of East Hartford business valuations.
Note that this is the median asking price for a business. If you are in the market to buy a company, you may be able to buy an East Hartford business for much less. The flip side is that some East Hartford businesses may cost much more.
Another thing you should know is that this is the asking price for an East Hartford business. Typically, when an owner lists a business for sale, they start with an asking price that is higher than the final sale price. The sale-price-to-asking-price ratio varies considerably but typically might be between 0.85 and 0.90. That is to say, if an owner lists a business for $150,000, it might sell for between $127,500 and $135,000.
If you are interested in trends in business-for-sale asking prices, here are the median asking prices for businesses for sale in the Hartford-West Hartford-East Hartford, CT metro area for the last 8 quarters.
Revenue Multiples In East Hartford, CT
In the Hartford-West Hartford-East Hartford, CT metro area, businesses will typically sell for 0.61 times the selling company's revenues. This was the mean revenue multiple for Q4 2008 in this area of the country.
In other words, a business that has revenues of $200,000 might list for $121,238. Remember, however, that this is just an average for revenue multiples in the area. Some firms will have higher revenue multiples and others will have lower revenue multiples.
Here is how median revenue multiples are trending in the East Hartford area, based on BizBuySell.com's quarterly reports.
According to BizBuySell.com, the median revenues for its business-for-sale listings was $396,000 in Q4 2008.
Cash Flow Multiples In East Hartford, CT
Another common method to value a business is through cash flow multiples.
For Q4 2008, the average cash flow multiple for businesses listed in the Hartford-West Hartford-East Hartford, CT metro area was 2.74.
So, a business with cash flows of $120,000 might have an asking price of $328,853. That's if the business fits the area average. Most businesses will not conform to industry- or area averages.
The table below shows how cash flow multiples are trending in the East Hartford area, based on BizBuySell.com's quarterly reports.
Flow Multiple
If you are interested in what cash flows are for a business in East Hartford, BizBuySell.com reports that the median cash flow for East Hartford area businesses was $92,673 in Q4 2008.
Tips for East Hartford, CT Business Buyers
If you are looking to buy a business, be sure to contact business intermediaries who represent selling businesses within your targeted market. They will notify you of available companies that meet your criteria and qualifications. Most business brokers or intermediaries work for the seller and are paid by the seller. That means you can enjoy the luxury of their services at no cost. This helpful advice was provided by Domenic Rinaldi, managing partner of Chicagoland Sunbelt, a leading business brokerage firm.
Business Valuations for East Hartford, CT Businesses
If you have a specific business in mind and want to look at comparables in the area, we recommend the BizBuySell.com Business Valuation Tool. You can refine the dataset that generates business valuations to meet your specific needs, and 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 indicator that tracks the health of the U.S. small business economy. If you find this data interesting, be sure to visit BizBuySell.com Insights Report for more information.
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