Q1 2009 Costs to Buy a Business
How Much Is My Joliet Business Worth?
We just received the latest Joliet, Illinois business valuation data for First Quarter 2009.
Q1 2009 Business Valuations in Joliet, IL
According to statistics issued by BizBuySell.com, Joliet business-for-sale listings in Q1 2009 had a median asking price of $275,000.
That compares to a median ask price of $260,000 in Q1 2008. Because the median ask price for businesses for sale in Joliet has risen year over year, we can conclude that many smaller firms in Joliet are holding off on selling.
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 Joliet company for much less. However, some Joliet businesses may be selling for much more.
Also, this is the asking price for a Joliet business. When a company owner lists a company for sale, they typically set a price that ends up being more than the contracted sale price. A sale-to-ask ratio typically might be between 0.85 and 0.90, but of course it depends on deal specifics. So, a business listed for $100,000 might sell for between $85,000 and $90,000.
Number of Joliet Businesses for Sale in the Dataset
The study data comprised 582 listings in the Chicago-Naperville-Joliet, IL-IN-WI metro area. As such, some of the businesses used to derive the median valuation might be outside of Joliet, but they are in the area and so are probably representative of Joliet business valuations.
One year ago, in Q1 2008, the BizBuySell.com dataset for Joliet spanned 601 listings. The downward trend in the number of Joliet business-for-sale listings is indicative of the current down economy.
Q1 2009 Revenue Multiples In Joliet, IL
In the Chicago-Naperville-Joliet, IL-IN-WI metro area, companies will typically sell for 0.82 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 $163,591. Remember, however, that this is only an average for revenue multiples in Joliet 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 $450,000 in Q1 2009.
To put this in perspective, the Q1 2008 revenue multiple was 0.85 and the median revenue for listed businesses was $407,644.
Q1 2009 Cash Flow Multiples In Joliet, IL
Cash flow multiples are another common way to value a business.
For Q1 2009, the average cash flow multiple for listed businesses in the Chicago-Naperville-Joliet, IL-IN-WI metro area was 3.28.
So, a business with cash flows of $150,000 might have an asking price of $491,836. That's only if the firm complies with the local average. Most businesses will not conform to industry- or area averages.
In case you were wondering what typical cash flows are for a business in Joliet, BizBuySell.com determined that the median cash flow for Joliet area businesses was $100,448 in Q1 2009. In Q1 2008, cash flow multiples clocked in at 3.38 and the median cash flow was $100,000.
Things to Consider When Selling a Business in Joliet, IL
The best time to sell a business is when you don't have to sell the business. If you have to sell under time pressure, you are not likely to get the best sale price. So, don't wait to sell a business until something (e.g. bad health, a divorce, etc.) forces you to sell. This advice on selling a business comes from Domenic Rinaldi, managing partner of Sun Acquisitions, a leading business brokerage firm.
Business Valuations for Joliet, IL 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 Joliet, IL Business Valuations
If you are interested in trends in business-for-sale asking prices, here are the median asking prices for businesses in the Chicago-Naperville-Joliet, IL-IN-WI metro area for the last 9 quarters.
Here is how median revenue multiples are trending in the Joliet area, based on BizBuySell.com's quarterly reports.
Here is how cash flow multiples are trending in the Joliet area, based on BizBuySell.com's quarterly reports.
Flow Multiple
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