Q1 2009 Costs to Buy a Business
How Much Is My Dallas Business Worth?
We just received the latest Dallas, Texas business-for-sale statistics.
Q1 2009 Business Valuations in Dallas, TX
Based on data compiled by BizBuySell.com, Dallas business-for-sale listings in Q1 2009 had a median asking price of $285,000.
That compares to a median ask price of $300,000 in Q1 2008. Given that Dallas, TX median business asking prices appear to be dropping, it suggests that larger Dallas businesses in may be holding off on selling until the economy turns around.
To be clear, this is the median asking price for a business. If you want to buy a business, you may be able to buy a Dallas company for much less. However, some Dallas businesses may be selling for much more.
Also, this is the asking price for a Dallas business. When a business owner lists a company for sale, they typically set a price that ends up being more than the eventual sale price. A sale-to-ask ratio typically might be between 0.85 and 0.90, but of course it varies considerably. So, a business listed for $100,000 might sell for between $85,000 and $90,000.
Number of Dallas Businesses for Sale in the Dataset
The study data comprised 990 listings in the Dallas-Fort Worth-Arlington, TX metro area. As such, some of the businesses used to derive the median valuation might be outside of Dallas, but they are in the area and so are likely representative of Dallas business valuations.
One year ago, in Q1 2008, the BizBuySell.com dataset for Dallas spanned 1038 listings. In a market where you would think fewer business owners would be selling, it's a bit surprising to see more Dallas business-for-sale listings.
Q1 2009 Revenue Multiples In Dallas, TX
In the Dallas-Fort Worth-Arlington, TX metro area, businesses will typically sell for 1.01 times the selling company's revenues. The data indicates that is the mean revenue multiple for Q1 2009 in this area of the country.
In other words, a business that has revenues of $200,000 might list for $202,772. Remember, however, that this is only an average for revenue multiples in the area. Some firms will have higher revenue multiples and others will have lower revenue multiples.
According to BizBuySell.com, the median revenues for its business-for-sale listings was $434,602 in Q1 2009.
To put this in perspective, the Q1 2008 revenue multiple was 1.04 and the median revenue for listed businesses was $460,950.
Q1 2009 Cash Flow Multiples In Dallas, TX
Cash flow multiples are another common way to value a business.
For Q1 2009, the average cash flow multiple for businesses listed in the Dallas-Fort Worth-Arlington, TX metro area was 3.69.
So, a business with cash flows of $150,000 might have an asking price of $552,992. That's only if the firm complies with the local average. Most businesses will not conform to industry- or area averages.
If you are interested in what cash flows are for a business in Dallas, BizBuySell.com found that the median cash flow for Dallas area businesses was $108,110 in Q1 2009. In Q1 2008, cash flow multiples clocked in at 3.81 and the median cash flow was $110,000.
Things to Consider When Selling a Business in Dallas, TX
When selling a business, valuations will be based on your profits. So, be sure to sell a business at a point when your profits are doing well if you want to sell for a great price. This helpful tip comes from Domenic Rinaldi, managing partner of Sun Acquisitions, a leading business brokerage firm.
Business Valuations for Dallas, TX Businesses
If you are contemplating buying a business or selling a business and would like to look at comparables in the area, we suggest you try the BizBuySell.com Business Valuation Tool. You can modify the dataset that creates business valuation estimates to meet your specific criteria. As a bonus, 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 report that tracks trends in the business-for-sale marketplace. If you find these trends interesting, take a moment to visit BizBuySell.com Insights Report for more information.
Historical Data for Dallas, TX Business Valuations
If you are interested in trends in business-for-sale asking prices, here are the median asking prices for companies in the Dallas-Fort Worth-Arlington, TX metro area for the last 9 quarters.
Here is how median revenue multiples are trending in the Dallas area, based on BizBuySell.com's quarterly reports.
The table below shows how cash flow multiples are trending in the Dallas area, based on BizBuySell.com's quarterly reports.
Flow Multiple
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