Buying a Business
Cost to Buy a Business in San Marcos
Considering purchasing a company in San Marcos, California? You're no doubt wondering how much a typical San Marcos, California business costs to buy.
Fortunately, the folks at BizBuySell.com have made some data available on what it costs to buy a business in San Marcos.
BizBuySell.com is the largest online marketplace for business-for-sale transactions. The vast majority of business brokers in the country put their business listings on BizBuySell.com. In addition, many business owners who are selling on their own, without a broker, will place listings on BizBuySell.com.
If you want to buy a company in California, check out the BizBuySell California listings to to be on the inside track with the newest business-for-sale listings for San Marcos and other California cities.
Business Valuations in San Marcos, CA
According to BizBuySell.com, the median asking price for an San Marcos business-for-sale listing in Q4 2008, the quarter when they most recently released their data, was $199,750.
That was based on 388 listings in the San Diego-Carlsbad-San Marcos, CA metro area. Many of the businesses in the dataset are outside of San Marcos, but they are close by and so are probably representative of San Marcos business valuations.
Note that this is the median asking price for a business. If you are in the market to buy a company, you may be able to buy an San Marcos business for much less. At the same time, some San Marcos businesses may cost much more.
Another thing you should know is that this is the asking price for an San Marcos business. Typically, when an entrepreneur lists a business for sale, they start with an asking price that is higher than the contracted sale price. The sale-price-to-asking-price ratio varies considerably but typically might be between 0.85 and 0.90. As such, a business listed for $175,000 might sell for between $148,750 and $157,500.
If you are interested in trends in business-for-sale asking prices, here are the median asking prices for companies in the San Diego-Carlsbad-San Marcos, CA metro area for the last 8 quarters.
Revenue Multiples In San Marcos, CA
In the San Diego-Carlsbad-San Marcos, CA metro area, small businesses will typically sell for 0.69 times the selling company's revenues. The data indicates that is the mean revenue multiple for Q4 2008 in this part of the country.
In other words, a business that has revenues of $200,000 might list for $138,134. Keep in mind that this is just an average for revenue multiples in the area. Some entities will have higher revenue multiples and others will have lower revenue multiples.
Here is how median revenue multiples are trending in the San Marcos area, based on BizBuySell.com's quarterly reports.
According to BizBuySell.com, the median revenues for its business-for-sale listings was $355,000 in Q4 2008.
Cash Flow Multiples In San Marcos, CA
Another popular way to value a business is through cash flow multiples.
For Q4 2008, the average cash flow multiple for listed businesses in the San Diego-Carlsbad-San Marcos, CA metro area was 2.77.
So, a business with cash flows of $120,000 might have an asking price of $332,023. That's if the business fits the area average. Most businesses will not conform to industry- or area averages.
Here is how cash flow multiples are trending in the San Marcos area, based on BizBuySell.com's quarterly reports.
Flow Multiple
If you are interested in what cash flows are for a business in San Marcos, BizBuySell.com reports that the median cash flow for San Marcos area businesses was $85,000 in Q4 2008.
Things to Consider When Buying a Business in San Marcos, CA
Many buyers want to look at all available options, thinking they'll recognize what they're looking for when they see it. That approach is actually a waste of valuable time and energy and can lead to frustration. A better strategy is to define what you are looking for and then only look at businesses that meet your criteria. This useful business buying advice comes from Domenic Rinaldi, managing partner of Chicagoland Sunbelt, a leading business brokerage firm.
Business Valuations for San Marcos, CA Businesses
If you have a specific business in mind and want to look at comparables in the area, we recommend the BizBuySell.com Business Valuation Tool. You can refine the dataset that generates business valuations to meet your specific needs, and access to the tool is very affordable -- less than $100.
More Information on BizBuySell.com's Quarterly Reports
The BizBuySell Insight Report is a nationally-recognized economic indicator that tracks the health of the U.S. small business economy. If you find this data interesting, be sure to visit BizBuySell.com Insights Report for additional information.
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