Buying a Business
Cost to Buy a Business in San Antonio
Considering purchasing a company in San Antonio, Texas? You're no doubt wondering how much a typical San Antonio, Texas business costs to buy.
Fortunately, the folks at BizBuySell.com have made some data available on what it costs to buy a business in San Antonio.
BizBuySell.com is the Internet's largest and most heavily trafficked business for sale marketplace. The vast majority of business brokers in the country put their business listings on BizBuySell.com. They also have many FSBO (for sale by owner) business-for-sale listings.
If you want to buy a company in Texas, check out the BizBuySell Texas listings to see the latest business-for-sale listings for San Antonio and other Texas cities.
Business Valuations in San Antonio, TX
According to BizBuySell.com, the median asking price for an San Antonio business-for-sale listing in Q4 2008, the quarter when they most recently released their data, was $307,500.
That was based on 130 listings in the San Antonio, TX metro area. As such, some of the businesses used to derive the median valuation might be outside of San Antonio, but they are nearby and so are probably representative of San Antonio 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 San Antonio business for much less. At the same time, some San Antonio businesses may cost much more.
Another thing you should know is that this is the asking price for an San Antonio business. Typically, when a company owner lists a business for sale, they start with an asking price that is higher than the eventual sale price. The sale-price-to-asking-price ratio varies considerably but typically might be between 0.85 and 0.90. Based on this rule of thumb, a business listed for $225,000 might sell for between $191,250 and $202,500.
If you are interested in trends in business-for-sale asking prices, here are the median asking prices for companies in the San Antonio, TX metro area for the last 8 quarters.
Revenue Multiples In San Antonio, TX
In the San Antonio, TX metro area, companies will typically sell for 1.21 times the selling company's revenues. That 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 $241,553. Remember, however, that this is just an average for revenue multiples in San Antonio and surrounding communities. Some companies will have higher revenue multiples and others will have lower revenue multiples.
Here is how median revenue multiples are changing in the San Antonio area, based on BizBuySell.com's economic data.
According to BizBuySell.com, the median revenues for its business-for-sale listings was $464,500 in Q4 2008.
Cash Flow Multiples In San Antonio, TX
Another popular way to value a business is through cash flow multiples.
For Q4 2008, the average cash flow multiple for businesses listed in the San Antonio, TX metro area was 4.23.
So, a company with cash flows of $120,000 might have an asking price of $507,599. 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 San Antonio area, based on BizBuySell.com's quarterly reports.
Flow Multiple
If you are interested in what cash flows are for a business in San Antonio, BizBuySell.com determined that the median cash flow for San Antonio area businesses was $95,000 in Q4 2008.
Things to Consider When Buying a Business in San Antonio, TX
Once you have a business that you would like to buy, it may be time to bring in your attorney. However, refrain from spending lots of money on legal documentation until you are certain you are going to buy the business. Many buyers spend money on legal fees before they are committed to buying a coompany...that's a mistake you'll want to avoid. This helpful tip comes from Domenic Rinaldi, managing partner of Chicagoland Sunbelt, a leading business brokerage firm.
Business Valuations for San Antonio, TX Businesses
If you have a specific business in mind and want to value the business, 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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