Takeaways from the Latest BizBuySell Insight Report

Thinking of buying or selling a business? Then take a look at the quarterly BizBuySell reports that compile data from the sale and list prices of approximately 50,000 businesses across the United States.  You can get statistics gathered from successful transactions over the past three years and insight on the trends that are at play. 

A Boom for Sellers 

The latest BizBuySell report, which covers Q4 of 2021, found that 2022 is a seller’s market. Business sales in  4th Qtr 2021 actually surpassed  pre-pandemic numbers for 4th Qtr 2019. This is a major shift away from stagnant sales in 2020.  Moreover, 74% of brokers stated that their sales were steady in 4th Qtr, a fiscal quarter that typically sees lower than average business sales. Experts say that this strength has carried into early 2022. 

Other notable sales statistics include the following:

  • 8,647 closed transactions were reported in 2021, an increase from 7,612 in 2020
  • Sales prices increased 16% year-over-year 
  • Median cash flow grew 10% year-over-year

Buyers are Looking for Quality

Buyers are currently looking for strong financials.  Sixty percent (60%) of surveyed buyers indicated that strong financials were a “must have.”  This number is in stark contrast to 18% of buyers who considered discounted opportunities attractive, indicating that buyers want financial results and are willing to pay for them.

Labor Shortages and Supply Chain issues 

The BizBuySell report also discussed the prevalence of labor shortages.  In fact, 64% of business owners surveyed said that they labor shortages have had an impact on their business. Business brokers agree that labor shortage is currently the biggest issue for small businesses. Supply chain disruptions have also impacted  75% of responding business owners.  

A More Balanced Landscape

Brokers were asked if they believed  owners were more or less likely to sell their business in 2022 than they were in 2021.  Most brokers believed that there would be more businesses sold this year than last. In 2021, many brokers believed that buyers had the edge over sellers.  Now  brokers feel that the landscape has shifted and become more balanced overall.

Copyright: Business Brokerage Press, Inc.


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