Q1 2009 Costs to Buy a Business
How Much Is My Cary Business Worth?
We just received the latest Cary, North Carolina business valuation data for First Quarter 2009.
Q1 2009 Business Valuations in Cary, NC
According to statistics issued by BizBuySell.com, Cary business-for-sale listings in Q1 2009 had a median asking price of $242,500.
That compares to a median ask price of $250,000 in Q1 2008. One interpretation of the lower median asking price is that Cary, NC sellers are dropping their asking prices in light of market conditions.
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 Cary company for much less. However, some Cary businesses may be selling for much more.
Another thing to remember is that this is the asking price for a Cary business. When a small business owner 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 Cary Businesses for Sale in the Dataset
The study data comprised 180 listings in the Raleigh-Cary, NC metro area. As such, some of the businesses used to derive the median valuation might be outside of Cary, but they are in the area and so are probably representative of Cary business valuations.
One year ago, in Q1 2008, the BizBuySell.com dataset for Cary spanned 123 listings. In a market where you would think fewer business owners would be selling, it's a bit surprising to see more Cary business-for-sale listings.
Q1 2009 Revenue Multiples In Cary, NC
In the Raleigh-Cary, NC metro area, small businesses will typically sell for 0.80 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 $159,853. Remember, however, that this is just an average for revenue multiples in Cary and surrounding communities. Some firms 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 $400,000 in Q1 2009.
To put this in perspective, the Q1 2008 revenue multiple was 0.77 and the median revenue for listed businesses was $380,000.
Q1 2009 Cash Flow Multiples In Cary, NC
Cash flow multiples are another common way to value a business.
For Q1 2009, the average cash flow multiple for businesses listed in the Raleigh-Cary, NC metro area was 3.33.
So, a company with cash flows of $150,000 might have an asking price of $498,813. That's only if the firm complies with the local average. Most businesses will not conform to industry- or area averages.
If you are interested in what cash flows are for a business in Cary, BizBuySell.com reports that the median cash flow for Cary area businesses was $89,506 in Q1 2009. In Q1 2008, cash flow multiples clocked in at 3.37 and the median cash flow was $76,400.
Things to Consider When Selling a Business in Cary, NC
In this difficult econonmic environment, sellers must be bankers. That means you should offer seller financing to prospective buyers because you, as a seller, may be their only viable source of financing. This tip for selling a business was provided by Domenic Rinaldi, managing partner of Sun Acquisitions, a leading business brokerage firm.
Business Valuations for Cary, NC Businesses
If you are contemplating buying a business or selling a business and would like to get an estimated business valuation, 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 more information.
Historical Data for Cary, NC Business Valuations
If you are interested in trends in business-for-sale asking prices, here are the median asking prices for businesses for sale in the Raleigh-Cary, NC metro area for the last 9 quarters.
Here is how median revenue multiples are changing in the Cary area, based on BizBuySell.com's quarterly reports.
The table below shows how cash flow multiples are trending in the Cary area, based on BizBuySell.com's quarterly reports.
Flow Multiple
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