Q1 2009 Costs to Buy a Business
How Much Is My Miami Business Worth?
We just received the latest Miami, Florida business valuation data for First Quarter 2009.
Q1 2009 Business Valuations in Miami, FL
According to statistics issued by BizBuySell.com, Miami business-for-sale listings in Q1 2009 had a median asking price of $265,000.
That compares to a median ask price of $299,000 in Q1 2008. One interpretation of the lower median asking price is that Miami, FL 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 Miami company for much less. However, some Miami businesses may be selling for much more.
Another thing to remember is that this is the asking price for a Miami business. When a 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. Given this industry statistic, if a small business owner were to list a company for $300,000, it might sell for between $255,000 and $270,000.
Number of Miami Businesses for Sale in the Dataset
The study data comprised 1986 listings in the Miami-Fort Lauderdale-Miami Beach, FL metro area. As such, some of the businesses used to derive the median valuation might be outside of Miami, but they are in the area and so are likely representative of Miami business valuations.
In Q1 2008, just one year ago, there were 2218 Miami listings in the BizBuySell.com dataset. As a result of the recession, fewer Miami business owners are selling because they hope to weather the storm and sell after the economy turns around.
Q1 2009 Revenue Multiples In Miami, FL
In the Miami-Fort Lauderdale-Miami Beach, FL metro area, small businesses will usually sell for 0.89 times the selling company's revenues. That was the mean revenue multiple for Q1 2009 in this metro area.
In other words, a business that has revenues of $200,000 might list for $178,065. Remember, however, that this is just an average for revenue multiples in the area. Some small businesses 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 $424,660 in Q1 2009.
To give this some context, the Q1 2008 revenue multiple was 0.98 and the median revenue for listed businesses was $460,942.
Q1 2009 Cash Flow Multiples In Miami, FL
Cash flow multiples are another popular technique to value a business.
For Q1 2009, the average cash flow multiple for listed businesses in the Miami-Fort Lauderdale-Miami Beach, FL metro area was 3.22.
So, a business with cash flows of $150,000 might have an asking price of $482,754. That calculation is dependent on the business selling for the area's average multiple. Most businesses will not conform to industry- or area averages.
If you are interested in what cash flows are for a business in Miami, BizBuySell.com reports that the median cash flow for Miami area businesses was $109,514 in Q1 2009. In Q1 2008, cash flow multiples clocked in at 3.38 and the median cash flow was $115,055.
Tips for Miami, FL Business Sellers
When choosing a business broker, look for a broker that can maintain confidentiality and simultaneously get you the most qualified buyers. In addition, make sure the business broker has a good track record in facilitating negotiations between buyer and seller in a way that arrives at the best possible transaction. This helpful tip comes from Domenic Rinaldi, managing partner of Sun Acquisitions, a leading business brokerage firm.
Business Valuations for Miami, FL 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 Miami, 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 Miami-Fort Lauderdale-Miami Beach, FL metro area for the last 9 quarters.
Here is how median revenue multiples are moving in the Miami area, based on BizBuySell.com's quarterly reports.
The table below shows how cash flow multiples are trending in the Miami area, based on BizBuySell.com's quarterly reports.
Flow Multiple
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