Every Quarter Biz Buy Sell releases stats on the state of small business sales in the US. Overall it is pretty good data but in reading this quarters reports some things jumped out.
First and foremost the report is on this link: http://ow.ly/PEutp
In short things as they stand today are good. Volume is up, Prices are up, cash flows are up. But to the followers of this blog and my numerous tweets somethings should have jumped out at you:
1. In the list of markets where inventory and deal volume are up nowhere was a Florida market or City.
2. The lift in manufacturing companies going to market was extremely odd and more important when reconciled against the listing markets. Keep in mind that durable good orders generally have a trail folks of 6 to 12 months from order to ship date.
3. The baby boomer phenomenon was touched on.
These three items should sound a bell for Sellers in Florida. Why? 1. Well as we have discussed inventory in Florida has lagged for several months…in June however we have seen a 15% lift in listing activity so the much anticipated swell of baby boomers is beginning.
2. Manufacturing companies tend to be owned by older sellers so it somewhat validates predictions regarding that generation.
3. The increase in inventory will somewhat impact prices as supply and demand will drive variables.
4. The volatile international situation will have an impact on funds available for immigration (we have seen a spike in Brazilians and Venezuelans).
5. The constant in all the stats is time to market…it generally takes 12 months to sell a business. With the increase in inventory and price pressure coupled with international turmoil we will see this possible stretch out further. Over pricing will only hurt sellers.
6. With an election year approaching in the US lending behavior will change undoubtedly so larger sellers need to factor that into the time to market calculation.
In Short folks…..if you were planning to sell in the next 24 months I would move the time line up to Q4 of this year at the latest to go to market.For more on this topic and more visit our website at https://yourfloridabusinessbroker.com