Are we dealing with a buyer's market?

Are we dealing with a buyer's market?  
 
Buying a business has changed enormously over the course of the past decade, with the recession shaking things up more than we could have predicted.

We've seen a dramatic increase in administrations as unstable companies failed to cope with the drop in cashflow that followed the economic crash, while buyers themselves showed increased levels of caution when acquiring new businesses.

Things are far from steady again now, but we are seeing signs of a return to a new kind of normality; one in which buyers have the upper hand.

An abundance of easily available credit resulted in the widespread adoption of the auction as the preferred method of selling a business. It allowed sellers to maximize tension between competing buyers, keeping the pressure on and pushing the price up.

However, as the number of buyers capable of still affording to make an acquisition reduced in the wake of the crash, the remaining bidders demands increased.

Buyers were no longer happy to hope for the best and instead have started to demand more tailored information at earlier stages of the buying process in order to guarantee their success. 

In essence, these factors combined to bring two key changes to the market. Firstly, the number of bidders for each business has been drastically reduced, lowering pressure and competition. And secondly, caution among buyers has increased significantly, prompting investors to be more demanding when making new acquisitions.

Obviously, sellers need to keep these issues in mind when they put their business on the market. But we hope our subscribers who are out to buy a business are also keeping an eye on the broader business atmosphere; a company's worth (and the price worth bidding for it) will of course change in different economic periods and it is clearly the case that now is looking like a good time to buy a business for less. 

For a complimentary consultation:
Contact  Cecil Williams (cecil@bizbrokerflorida.com) or call  at 888-925-5055 ext.206.  Visit my personal website to search for business for sale in Florida www.bizbrokerflorida.com  Also, visit our Florida Business Exchange website at www.fbxbrokers.com