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“Why now is a good time to sell your business”

Posted on August 15, 2017

Business owners often ask me if now is a good time for them to sell their business? My answer is always, “if your business is ready to sell, then now is a great time to consider selling.”

Four reasons to consider selling now are:

It is currently a sellers market

• There are more buyers looking to buy a business than those offered for sale. With the Recession of 2008 – 2010 essentially over, during which time it was difficult to borrow money to buy a business, there is an increasing number of qualified buyers creating significant pent up demand for the purchase of businesses.

• In addition, the pent up demand has resulted in improved earnings multiples over what they were during the recent recession.

There is lots of Financing available

• Interest rates remain at some of the lowest levels many in recent history.

• Both traditional lenders and secondary lenders have overflowing coffers of money that they are keen to place into loan portfolios. Buyers can readily borrow the money required to buy your business.

The Boomers are aging

• The Baby Boomers; those born between 1946 and 1964, own 70% of the small to medium size businesses in Canada. This means the oldest Boomers are 66 years old and are starting to sell. The next wave of Boomers, those who are turning 60 this year, are starting the planning process to sell. Statistics show that the numbers of businesses that will be sold in the next few years is a staggering number…….over 1 Million across Canada; over 170,000 in BC alone.

• The smart business owner will want to get ahead of this wave that is coming. In the not to distant future, the current sellers market will quickly change to a buyers market.

Availability of Professional Mergers & Acquisitions Advisors

• Very few business owners have experience at selling a business. It takes professional credentials, years of experience, a quality list of buyer contacts, an excellent reputation in the Industry and a maturity to manage the “deal”. Given the complications and time constraints that each file places on the M&A Advisor, each Advisor can only manage so many files at once. As business volumes grow, a seller may have a challenge in obtaining the services of a qualified M&A Advisor.

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