Time to Buy — Your Way into a Job
By Angus Loten, Recessionwire.com
If you’re looking for an employer or want to expand your business, now’s a good time to make a move.
Thanks to the recession, there’s never been a better time to buy a small business—provided you’ve got the financial wherewithal. There has been a surge in the number of small businesses going up for sale in the past few months, but only half as many have found buyers compared to the same period last year, according to BizBuySell.com, an online small-business marketplace. That means it’s a buyers’ market, conventional valuations are out the window and there are bargain-basement prices for investors willing to take a risk in a down market.
Among the small businesses that have sold this year, the median sales price has dropped by about 20 percent to $160,000 from $200,000 last year, the site reports.
Typically, brokers and market watchers gauge the value of these deals by dividing the asking price for a business by its annual revenue or cash flow. In the past few months, these figures, known as revenue or cash flow multiples, have dropped dramatically in closing prices, by between 2.5 and 8 percent. Until recently, both multiples were rising steadily.
To read more go to www.recessionwire.com.
