Q1 2009 Costs to Buy a Business
How Much Is My Las Vegas Business Worth?
We just received the latest Las Vegas, Nevada business valuation data for First Quarter 2009.
Q1 2009 Business Valuations in Las Vegas, NV
Based on data compiled by BizBuySell.com, Las Vegas business-for-sale listings in Q1 2009 had a median asking price of $207,500.
That compares to a median ask price of $225,000 in Q1 2008. Given that Las Vegas, NV median business asking prices appear to be dropping, it suggests that larger Las Vegas businesses in may be holding off on selling until the economy turns around.
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 Las Vegas company for much less. However, some Las Vegas businesses may be selling for much more.
Another thing to remember is that this is the asking price for a Las Vegas business. When a company owner lists a business for sale, they typically set a price that ends up being more than the ultimate sale price. A sale-to-ask ratio typically might be between 0.85 and 0.90, but of course it depends on deal specifics. So, a business listed for $100,000 might sell for between $85,000 and $90,000.
Number of Las Vegas Businesses for Sale in the Dataset
The study data comprised 388 listings in the Las Vegas-Paradise, NV metro area. As such, some of the businesses used to derive the median valuation might be outside of Las Vegas, but they are in the area and so are likely representative of Las Vegas business valuations.
One year ago, in Q1 2008, the BizBuySell.com dataset for Las Vegas spanned 505 listings. The downward trend in the number of Las Vegas business-for-sale listings is indicative of the current down economy.
Q1 2009 Revenue Multiples In Las Vegas, NV
In the Las Vegas-Paradise, NV metro area, businesses will typically sell for 0.81 times the selling company's revenues. That was the mean revenue multiple for Q1 2009 in this metro area.
In other words, a firm with revenues of $200,000 might list for $161,092. Remember, however, that this is in fact an average for revenue multiples in Las Vegas and surrounding communities. Some companies 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 $366,958 in Q1 2009.
To put this in perspective, the Q1 2008 revenue multiple was 0.88 and the median revenue for listed businesses was $385,000.
Q1 2009 Cash Flow Multiples In Las Vegas, NV
Cash flow multiples are another common way to value a business.
For Q1 2009, the average cash flow multiple for listed businesses in the Las Vegas-Paradise, NV metro area was 3.16.
So, a firm with cash flows of $150,000 might have an asking price of $474,540. That calculation is dependent on the business selling for the area's average multiple. The actual distribution on revenue multiples for a given set of businesses can be quite wide-ranging.
If you are interested in what cash flows are for a business in Las Vegas, BizBuySell.com reports that the median cash flow for Las Vegas area businesses was $96,790 in Q1 2009. In Q1 2008, cash flow multiples clocked in at 3.02 and the median cash flow was $100,000.
Things to Consider When Selling a Business in Las Vegas, NV
It's critical to keep the potential sale of your business as confidential as possible. If that confidentiality is compromised, you risk losing customers, employees and vendors. Loose lips sink ships...and sink business-for-sale transactions as well! This useful business selling advice comes from Domenic Rinaldi, managing partner of Sun Acquisitions, a leading business brokerage firm.
Business Valuations for Las Vegas, NV 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 more information.
Historical Data for Las Vegas, NV Business Valuations
If you are interested in trends in business-for-sale asking prices, here are the median asking prices for businesses in the Las Vegas-Paradise, NV metro area for the last 9 quarters.
Here is how median revenue multiples are changing in the Las Vegas area, based on BizBuySell.com's quarterly reports.
The table below shows how cash flow multiples are trending in the Las Vegas area, based on BizBuySell.com's quarterly reports.
Flow Multiple
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