Don't miss the gold rush. Small businesses are sold at their peak prices. Here are five completely new and unique reasons to prepare, appraise, and list your business for sale in 2021.
#1 Excess Money Supply
By now (Q1 2021), the money printed by central banks on both sides of the Atlantic has mounted to record-high levels. This money has flowed into the hands of commercial banks and private equity firms who are now panically seeking safe harbors for their [burning] funds.
#2 New Group of Business Buyers
Corporate refugees. Of 14+ million reported as currently unemployed, a small percentage (but large enough to generate demand) are former executives who now need to replace their income and thus are seeking a position of small business owner. Most of them have $500,000 to $1 million to invest and plenty of time on their hands to call on opportunities.
#3 Pandemic-Caused Movement
About 10% of existing business owners in the U.S. are looking to expand or upgrade their location. The high availability of businesses unable to withstand the pandemic is providing a great incentive for acquisitions. Business brokers attribute near 30% of 2020/2021 buyer inquiries to owners looking to expand.
#4 Baby Boomers!
Turns out that 30% of new business buyers are Baby Boomers (born between 1944 and 1964). Many in this seasoned group prefer business ownership over retirement as a means of staying active and influential.
Video: Should You Sell Your Company in 2021? | The Harbour Club
#5 High Demand
Last but not least: it's all about supply and demand. Because of Covid-19 pandemic situation, many business owners believe now is not a best time to sell, so they hold off. This makes the market attractive for owners that do decide to offer their profitable and crisis-proof company for sale. And because there’s now less competition in the business-for-sale marketplace and majority of companies are not doing well, businesses still with positive returns stand out from the crowd, and may be desirable for buyers.
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