Q1 2009 Costs to Buy a Business
How Much Is My Fremont Business Worth?
We just received the latest Fremont, California business-for-sale statistics.
Q1 2009 Business Valuations in Fremont, CA
According to statistics issued by BizBuySell.com, Fremont business-for-sale listings in Q1 2009 had a median asking price of $250,000.
That compares to a median ask price of $325,000 in Q1 2008. Given that Fremont, CA median business asking prices appear to be dropping, it suggests that larger Fremont 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 Fremont company for much less. However, some Fremont businesses may be selling for much more.
Another thing to remember is that this is the asking price for a Fremont business. When a business owner lists a business 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 Fremont Businesses for Sale in the Dataset
The study data comprised 319 listings in the San Francisco-Oakland-Fremont, CA metro area. Many of the businesses in the dataset are outside of Fremont, but they are in the area and so are likely representative of Fremont business valuations.
One year ago, in Q1 2008, the BizBuySell.com dataset for Fremont spanned 367 listings. The downward trend in the number of Fremont business-for-sale listings is indicative of the current down economy.
Fremont, CA Q1 2009 Revenue Multiples
In the San Francisco-Oakland-Fremont, CA metro area, businesses will typically sell for 0.70 times the selling company's revenues. This was 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 $139,044. Remember, however, 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.
According to BizBuySell.com, the median revenues for its business-for-sale listings was $500,000 in Q1 2009.
To put this in perspective, the Q1 2008 revenue multiple was 0.83 and the median revenue for listed businesses was $520,000.
Q1 2009 Cash Flow Multiples In Fremont, CA
Cash flow multiples are another common way to value a business.
For Q1 2009, the average cash flow multiple for listed businesses in the San Francisco-Oakland-Fremont, CA metro area was 3.08.
So, a business with cash flows of $150,000 might have an asking price of $461,810. That's only if the firm complies with the local average. In practice, cash flow multiples can vary considerably from one business to another.
If you are interested in what cash flows are for a business in Fremont, BizBuySell.com reports that the median cash flow for Fremont area businesses was $103,000 in Q1 2009. In Q1 2008, cash flow multiples clocked in at 3.45 and the median cash flow was $120,000.
Things to Consider When Selling a Business in Fremont, CA
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 Fremont, CA 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 additional information.
Historical Data for Fremont, CA Business Valuations
If you are interested in trends in business-for-sale asking prices, here are the median asking prices for businesses in the San Francisco-Oakland-Fremont, CA metro area for the last 9 quarters.
Here is how median revenue multiples are trending in the Fremont area, based on BizBuySell.com's quarterly reports.
Here is how cash flow multiples are trending in the Fremont area, based on BizBuySell.com's quarterly reports.
Flow Multiple
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