Q1 2009 Costs to Buy a Business
How Much Is My Tampa Business Worth?
We just received the latest Tampa, Florida business valuation data for First Quarter 2009.
Tampa, FL Q1 2009 Business Valuations
Based on data compiled by BizBuySell.com, Tampa business-for-sale listings in Q1 2009 had a median asking price of $199,000.
That compares to a median ask price of $225,000 in Q1 2008. Given that Tampa, FL median business asking prices appear to be dropping, it suggests that larger Tampa businesses in may be holding off on selling until the economy turns around.
To be clear, this is the median asking price for a business. If you want to buy a business, you may be able to buy a Tampa company for much less. However, some Tampa businesses may be selling for much more.
Another thing to remember is that this is the asking price for a Tampa business. When a company owner lists a company for sale, they typically set a price that ends up being more than the contracted sale price. A sale-to-ask ratio typically might be between 0.85 and 0.90, but of course it varies considerably. If an owner lists a business for $150,000, it might end up selling for between $127,500 and $135,000.
Number of Tampa Businesses for Sale in the Dataset
The study data comprised 938 listings in the Tampa-St. Petersburg-Clearwater, FL metro area. As such, some of the businesses used to derive the median valuation might be outside of Tampa, but they are nearby and so are likely representative of Tampa business valuations.
One year ago, in Q1 2008, the BizBuySell.com dataset for Tampa spanned 984 listings. The downward trend in the number of Tampa business-for-sale listings is indicative of the current down economy.
Tampa, FL Q1 2009 Revenue Multiples
In the Tampa-St. Petersburg-Clearwater, FL metro area, small businesses will usually sell for 0.94 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 $187,222. Remember, however, that this is simply an average for revenue multiples in Tampa 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 $341,478 in Q1 2009.
To put this in perspective, the Q1 2008 revenue multiple was 0.98 and the median revenue for listed businesses was $325,000.
Q1 2009 Cash Flow Multiples In Tampa, FL
Cash flow multiples are another common way to value a business.
For Q1 2009, the average cash flow multiple for listed businesses in the Tampa-St. Petersburg-Clearwater, FL metro area was 3.45.
So, a firm with cash flows of $150,000 might have an asking price of $517,630. That calculation is dependent on the business selling for the area's average multiple. In practice, cash flow multiples can vary considerably from one business to another.
In case you were wondering what typical cash flows are for a business in Tampa, BizBuySell.com reports that the median cash flow for Tampa area businesses was $80,050 in Q1 2009. In Q1 2008, cash flow multiples clocked in at 3.45 and the median cash flow was $84,596.
Things to Consider When Selling a Business in Tampa, FL
Buyers want a business that is easy to understand and easy to run. Prior to selling a business, be sure to prepare a thorough operations manual that explains in detail how a new buyer would run the business. This helpful advice on how to buy a business comes from Domenic Rinaldi, managing partner of Sun Acquisitions, a leading business brokerage firm.
Business Valuations for Tampa, 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 Tampa, FL Business Valuations
If you are interested in trends in business-for-sale asking prices, here are the median asking prices for companies in the Tampa-St. Petersburg-Clearwater, FL metro area for the last 9 quarters.
Here is how median revenue multiples are trending in the Tampa area, based on BizBuySell.com's quarterly reports.
The table below shows how cash flow multiples are trending in the Tampa area, based on BizBuySell.com's quarterly reports.
Flow Multiple
Share this article
Additional Resources for Entrepreneurs