Q1 2009 Costs to Buy a Business
How Much Is My Middletown Business Worth?
We just received the latest Middletown, Ohio business valuation data for First Quarter 2009.
Middletown, OH Q1 2009 Business Valuations
According to statistics issued by BizBuySell.com, Middletown business-for-sale listings in Q1 2009 had a median asking price of $272,000.
That compares to a median ask price of $225,000 in Q1 2008. Because the median ask price for businesses for sale in Middletown has risen year over year, we can conclude that many smaller firms in Middletown are holding off on selling.
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 Middletown company for much less. However, some Middletown businesses may be selling for much more.
Another thing to remember is that this is the asking price for a Middletown business. When a business owner lists a company 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. Based on this metric, a business initially priced at $225,000 might sell for between $191,250 and $202,500.
Number of Middletown Businesses for Sale in the Dataset
The study data comprised 108 listings in the Cincinnati-Middletown, OH-KY-IN metro area. As such, some of the businesses used to derive the median valuation might be outside of Middletown, but they are in the area and so are likely representative of Middletown business valuations.
One year ago, in Q1 2008, the BizBuySell.com dataset for Middletown spanned 123 listings. The downward trend in the number of Middletown business-for-sale listings is indicative of the current down economy.
Middletown, OH Q1 2009 Revenue Multiples
In the Cincinnati-Middletown, OH-KY-IN 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 part of the country.
In other words, a business that has revenues of $200,000 might list for $162,240. Remember, however, that this is strictly an average for revenue multiples in the area. Some 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 $440,000 in Q1 2009.
As a reference point, the Q1 2008 revenue multiple was 0.75 and the median revenue for listed businesses was $430,000.
Q1 2009 Cash Flow Multiples In Middletown, OH
Cash flow multiples are another popular technique to value a business.
For Q1 2009, the average cash flow multiple for businesses listed in the Cincinnati-Middletown, OH-KY-IN metro area was 4.18.
So, a firm with cash flows of $150,000 might have an asking price of $627,080. 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 Middletown, BizBuySell.com reports that the median cash flow for Middletown area businesses was $83,500 in Q1 2009. In Q1 2008, cash flow multiples clocked in at 3.70 and the median cash flow was $80,000.
Tips for Middletown, OH Business Sellers
When setting a price for a business, it's worthwhile to invest in a professional valuation. If you define the business selling price without a professional valuation, you may end up leaving money on the table or having an unrealistic price that prevents a deal from ever getting done. This helpful tip on buying a business comes from Domenic Rinaldi, managing partner of Sun Acquisitions, a leading business brokerage firm.
Business Valuations for Middletown, OH 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 published every quarter. If you find these trends interesting, take a moment to visit BizBuySell.com Insights Report for more information.
Historical Data for Middletown, OH Business Valuations
If you are interested in trends in business-for-sale asking prices, here are the median asking prices for companies in the Cincinnati-Middletown, OH-KY-IN metro area for the last 9 quarters.
Here is how median revenue multiples are tracking in the Middletown area, based on BizBuySell.com's quarterly reports.
Here is how cash flow multiples are trending in the Middletown area, based on BizBuySell.com's quarterly reports.
Flow Multiple
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