Buying a Business
Cost to Buy a Business in Tampa
Considering purchasing a company in Tampa, Florida? You're no doubt wondering how much a typical Tampa, Florida business costs to buy.
Fortunately, the folks at BizBuySell.com have made some data available on what it costs to buy a business in Tampa.
BizBuySell.com is the largest online marketplace for business-for-sale transactions. Their listings include almost all of the available listings from business brokers nationwide. In addition, many business owners who are selling on their own, without a broker, will place listings on BizBuySell.com.
If you are looking to buy a business in Florida, check out the BizBuySell Florida listings to see the latest business-for-sale listings for Tampa and other Florida towns.
Business Valuations in Tampa, FL
Based on the BizBuySell.com data, the median asking price for an Tampa business-for-sale listing in Q4 2008, the quarter when they most recently released their data, was $205,000.
That was based on 963 listings in the Tampa-St. Petersburg-Clearwater, FL metro area. Many of the businesses in the dataset are outside of Tampa, but they are in the area and so are likely representative of Tampa 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 Tampa business for much less. At the same time, some Tampa businesses may cost much more.
Another thing you should know is that this is the asking price for an Tampa business. Typically, when a business owner lists a business for sale, they start with an asking price that is higher than the eventual sale price. The sale-price-to-asking-price ratios depend on deal specifics but typically might be between 0.85 and 0.90. In other words, a business listed for $100,000 might sell for between $85,000 and $90,000.
If you are interested in trends in business-for-sale asking prices, here are the median asking prices for businesses in the Tampa-St. Petersburg-Clearwater, FL metro area for the last 8 quarters.
Revenue Multiples In Tampa, FL
In the Tampa-St. Petersburg-Clearwater, FL metro area, businesses will typically sell for 0.89 times the selling company's revenues. That was the mean revenue multiple for Q4 2008 in this part of the country.
In other words, a firm with revenues of $200,000 might list for $177,399. Keep in mind that this is in fact 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 Tampa area, based on BizBuySell.com's quarterly reports.
According to BizBuySell.com, the median revenues for its business-for-sale listings was $352,000 in Q4 2008.
Cash Flow Multiples In Tampa, FL
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 Tampa-St. Petersburg-Clearwater, FL metro area was 3.33.
So, a business with cash flows of $120,000 might have an asking price of $399,722. That's if the business fits the area average. Actual cash flow multiples are based on business specifics.
The table below shows how cash flow multiples are trending in the Tampa area, based on BizBuySell.com's quarterly reports.
In case you were wondering what typical cash flows are for a business in Tampa, BizBuySell.com found that the median cash flow for Tampa area businesses was $86,878 in Q4 2008.
Tips for Tampa, FL Business Buyers
Be sure to assess your financial situation. Be sure to carefully consider how much money you need and how much you want to earn. Your expectations need to be realistic and they must be something that can be achieved by the type of business you are searching for. This excellent business buying tip comes from Domenic Rinaldi, managing partner of Chicagoland Sunbelt, a leading business brokerage firm.
Business Valuations for Tampa, FL 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 published on a quarterly basis. If you find this data interesting, be sure to visit BizBuySell.com Insights Report for more information.
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