Business Buyer-Seller Confidence Index Is Strong for Sale of Small to Medium Size Companies

by William Bruce, President                                                                                                                   American Business Brokers Association
business-for-sale

BizBuySell.com, the Internet’s largest business-for-sale marketplace, recently announced the results of its annual Business Buyer-Seller Confidence Index, an indicator of small business buyer and seller sentiment on the current business-for-sale environment. The confidence index is calculated by evaluating survey responses of more than 1,500 people interested in either buying or selling a small business.

A separate score is calculated for both current small business owners interested in selling and prospective buyers currently exploring the market. Each group’s score ranges from 0 to 100, with 100 representing a perfect environment for buying or selling a business.

This year’s results showed sellers feeling more confident that they can successfully exit their businesses as the Seller Confidence Score grew to 62 after two consecutive years at 56. Not only did a majority of owners (58 percent) believe they can receive more money for their businesses than they could last year, but more than 90 percent were optimistic enough to say they will be able to achieve the same or higher sale price next year. Respondents to both questions responded with higher, more optimistic percentages than did the same last year. Overall, this is a good indication that sellers have seen conditions improve since the recession and are confident that favorable conditions will continue in 2016.

Sellers also indicated an increased number of buyers in the market this year. When asked to identify the biggest issues limiting their ability to sell, just 12 percent said they couldn’t find a buyer – a significant drop from the 27 percent who indicated a shortage of buyers in 2014. Perhaps even more importantly, 43 percent of sellers said they have no issues and could successfully exit their businesses right now compared to just 23 percent who felt the same level of confidence last year.

“Small business owners are definitely viewing today’s market as a great opportunity to sell,” said Bob House, Group GM of BizBuySell.com and BizQuest.com. “We’re also seeing this increased confidence translating into more owners actually listing their small business on the market. The number of for-sale businesses on BizBuySell.com reached a six-year high this year, driven by increasing small business financial performance in the post recession period.”

My own business sales, mergers and acquisitions practice based here on America’s Gulf Coast reflects this national trend.  We’re busier in my office now than we’ve been since early 2007.

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William Bruce is an Accredited Business Intermediary and Appraiser assisting buyers and sellers of privately held businesses in the transfer of ownership.  His practice includes consulting services nationally on issues of business valuation and transfer.  He currently serves as president of the American Business Brokers Association.  He may be reached at (251) 990-5934 or by email at Will@WilliamBruce.org.  His business brokerage website may be viewed at www.WilliamBruce.net.

 

About William Bruce

President, American Business Brokers Association / Business Broker and Accredited Business Intermediary assisting business buyers and sellers with the transfer of ownership since 1986 / Author: How to Buy a Business.
This entry was posted in Business Valuation & Appraisal, Buying or Selling a Business and tagged , , . Bookmark the permalink.

4 Responses to Business Buyer-Seller Confidence Index Is Strong for Sale of Small to Medium Size Companies

  1. Mark Phillips says:

    Hi Bruce,

    I’ve been offered an opportunity to join a newer business brokerage which was created by a very good friend of mine.

    It focuses on marketing businesses valued between 2m-100m. Their marketing, advertising platform, quality of their Listing campaign, etc appears to be very professional and unlike what many traditional business brokers do, respectfully (clearly they are going after the higher end market).

    I have followed your blog for a few years now and appreciate all of your updates and advice. I respect your experience and would welcome your opinion as to what you, being an experienced business broker, think of this company as I am in the process of determining if I am going to accept a position and join the team so to speak.

    When you get a chance, please visit http://www.goexio.com and take a look around. Please take a look at some of their listings and the quality of the marketing they put into each listing including the cinematography and videos.

    I would love your opinion as to what you think about a company like this. Also, I know they are wanting to allow other business brokers throughout the country and opportunity to use their marketing platform for any deals that business brokers feel might warrant such a high-quality listing campaign.

    The name of the company is Exio. The website is http://www.goexio.com.

    It is my understanding they do not want to necessarily compete with other business brokers but actually partner with them in higher level deals as Business brokers may come across listing opportunities that are in the higher end market that would warrant such high-quality marketing and efforts that Exio offers.

    Anyway, I would welcome your thoughts and opinions as to this opportunity for me to get involved in. However I know you were busy and please do not feel obligated to look at it if you don’t have the time.

    Respectfully,

    Mark Phillips 210-419-3604

    Sent from my iPhone

    >

  2. Will:

    We seem to be having the same experience up here in northern New England. We had expected a drop off in business like has happened in the past during Presidential elections, but this time our business is picking up nicely. We need more people to deal with the increase.

    • Leon, thanks for dropping in. In the last three weeks, my prospective buyer inquiries from the business-for-sale websites have increased very significantly. I was talking to two brokers today, one in Arkansas and another in Colorado, who are experiencing the same thing. Like you, we usually experience a drop off heading into the uncertainty of a presidential election. But not this time!

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