Q1 2009 Costs to Buy a Business
How Much Is My Elyria Business Worth?
We just received the latest Elyria, Ohio small business valuation trend data for First Quarter 2009.
Q1 2009 Business Valuations in Elyria, OH
Based on data compiled by BizBuySell.com, Elyria business-for-sale listings in Q1 2009 had a median asking price of $177,500.
That compares to a median ask price of $199,000 in Q1 2008. Given that Elyria, OH median business asking prices appear to be dropping, it suggests that larger Elyria businesses in may be holding off on selling until the economy turns around.
Please understand that this is the median asking price for a business. If you want to buy a business, you may be able to buy a Elyria company for much less. Alternatively, some Elyria businesses may be selling for much more.
Another thing to remember is that this is the asking price for a Elyria business. When a business owner lists a business for sale, they typically set a price that ends up being more than the final sale price. A sale-to-ask ratio typically might be between 0.85 and 0.90, but of course it varies considerably. Given this industry statistic, if a small business owner were to list a company for $300,000, it might sell for between $255,000 and $270,000.
Number of Elyria Businesses for Sale in the Dataset
The study data comprised 96 listings in the Cleveland-Elyria-Mentor, OH metro area. Many of the businesses in the dataset are outside of Elyria, but they are in the area and so are probably representative of Elyria business valuations.
One year ago, in Q1 2008, the BizBuySell.com dataset for Elyria spanned 163 listings. In a market where you would think fewer business owners would be selling, it's a bit surprising to see more Elyria business-for-sale listings.
Q1 2009 Revenue Multiples In Elyria, OH
In the Cleveland-Elyria-Mentor, OH metro area, businesses will usually sell for 0.75 times the selling company's revenues. That was the mean revenue multiple for Q1 2009 in this area of the country.
In other words, a firm with revenues of $200,000 might list for $150,020. Keep in mind that this is in fact an average for revenue multiples in Elyria and surrounding communities. 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 $306,714 in Q1 2009.
To put this in perspective, the Q1 2008 revenue multiple was 0.69 and the median revenue for listed businesses was $380,894.
Q1 2009 Cash Flow Multiples In Elyria, OH
Cash flow multiples are another common way to value a business.
For Q1 2009, the average cash flow multiple for listed businesses in the Cleveland-Elyria-Mentor, OH metro area was 3.45.
So, a business with cash flows of $150,000 might have an asking price of $518,246. 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 Elyria, BizBuySell.com reports that the median cash flow for Elyria area businesses was $64,918 in Q1 2009. In Q1 2008, cash flow multiples clocked in at 3.32 and the median cash flow was $70,452.
Tips for Elyria, OH Business Sellers
It's critical to keep the potential sale of your business as confidential as possible. If that confidentiality is compromised, you risk losing customers, employees and vendors. Loose lips sink ships...and sink business-for-sale transactions as well! This useful business selling advice comes from Domenic Rinaldi, managing partner of Sun Acquisitions, a leading business brokerage firm.
Business Valuations for Elyria, OH 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 published every quarter. If you find these trends interesting, take a moment to visit BizBuySell.com Insights Report for more information.
Historical Data for Elyria, OH Business Valuations
If you are interested in trends in business-for-sale asking prices, here are the median asking prices for businesses in the Cleveland-Elyria-Mentor, OH metro area for the last 9 quarters.
Here is how median revenue multiples are moving in the Elyria area, based on BizBuySell.com's quarterly reports.
The table below shows how cash flow multiples are trending in the Elyria area, based on BizBuySell.com's quarterly reports.
Flow Multiple
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