Buying a Business
Cost to Buy a Business in Vancouver
Considering purchasing a company in Vancouver, Washington? You're no doubt wondering how much a typical Vancouver, Washington business costs to buy.
Fortunately, the folks at BizBuySell.com have made some data available on what it costs to buy a business in Vancouver.
BizBuySell.com is the biggest business-for-sale listings site on the Internet, offering over 50,000 businesses for sale at any given time. 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 Washington, take a look at the BizBuySell Washington listings to see the latest business-for-sale listings for Vancouver and other Washington municipalities.
Vancouver, WA Business Valuations
According to BizBuySell.com, the median asking price for an Vancouver business-for-sale listing in Q4 2008, the quarter when they most recently released their data, was $289,500.
That was based on 199 listings in the Portland-Vancouver-Beaverton, OR-WA metro area. As such, some of the businesses used to derive the median valuation might be outside of Vancouver, but they are nearby and so are probably representative of Vancouver 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 Vancouver business for much less. The flip side is that some Vancouver businesses may cost much more.
Importantly, this is the asking price for an Vancouver 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 ratio varies considerably but typically might be between 0.85 and 0.90. For example, a business listed for $250,000 would go for between $212,500 and $225,000.
If you are interested in trends in business-for-sale asking prices, here are the median asking prices for businesses in the Portland-Vancouver-Beaverton, OR-WA metro area for the last 8 quarters.
Revenue Multiples In Vancouver, WA
In the Portland-Vancouver-Beaverton, OR-WA metro area, businesses will typically sell for 0.83 times the selling company's revenues. That was the mean revenue multiple for Q4 2008 in this area of the country.
In other words, a firm with revenues of $200,000 might list for $166,030. Remember, however, that this is just an average for revenue multiples in the area. Some firms will have higher revenue multiples and others will have lower revenue multiples.
Here is how median revenue multiples are trending in the Vancouver area, based on BizBuySell.com's economic data.
According to BizBuySell.com, the median revenues for its business-for-sale listings was $436,000 in Q4 2008.
Cash Flow Multiples In Vancouver, WA
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 Portland-Vancouver-Beaverton, OR-WA metro area was 3.47.
So, a firm with cash flows of $120,000 might have an asking price of $415,881. That's if the business fits the area average. Most businesses will not conform to industry- or area averages.
The table below shows how cash flow multiples are trending in the Vancouver area, based on BizBuySell.com's quarterly reports.
If you are interested in what cash flows are for a business in Vancouver, BizBuySell.com reports that the median cash flow for Vancouver area businesses was $100,000 in Q4 2008.
Things to Consider When Buying a Business in Vancouver, WA
When buying a business, always start with a self assessment. Ask yourself why you want to buy a business. What types of work activities do you like and what kind of lifestyle do you want to pursue? Be sure to include your family in the assessment. This helpful tip comes from Domenic Rinaldi, managing partner of Chicagoland Sunbelt, a leading business brokerage firm.
Business Valuations for Vancouver, WA Businesses
If you have a specific business in mind and want to find out how much a business is worth, 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 more information.
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