Q3 2009 Business Valuation Data

Sell My Fremont, CA Business

We just received the latest Fremont, California business valuation data for Third Quarter 2009.

Median Ask Prices for Fremont, CA Businesses

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 11 quarters.

Quarter
Median Ask
Q1 2007
$225,000
Q2 2007
$269,000
Q3 2007
$298,000
Q4 2007
$279,500
Q1 2008
$325,000
Q2 2008
$279,000
Q3 2008
$250,000
Q4 2008
$250,000
Q1 2009
$250,000
Q2 2009
$245,000
Q3 2009
$225,000

As you can see from the chart above, Fremont business-for-sale listings in Q3 2009 had a median asking price of $225,000.

That compares to a median ask price of $250,000 in Q3 2008. Given that Fremont, CA median business asking prices appear to be dropping, it suggests that selling Fremont businesses may be lowering their prices to make their businesses more attractive to buyers.

Revenue Multiples for Fremont, CA Businesses

Here is how median revenue multiples are trending in the Fremont area, based on BizBuySell.com's economic data.

Quarter
Revenue Multiple
Q1 2007
0.71
Q2 2007
0.86
Q3 2007
0.85
Q4 2007
0.81
Q1 2008
0.83
Q2 2008
0.77
Q3 2008
0.77
Q4 2008
0.69
Q1 2009
0.70
Q2 2009
0.70
Q3 2009
0.71

In the San Francisco-Oakland-Fremont, CA metro area, small companies will usually sell for 0.71 times the selling company's revenues. As shown in the chart above, that was the mean revenue multiple for Q3 2009 in this area of the country.

In other words, a business that has revenues of $150,000 might list for $105,980. Keep in mind that this is in fact an average for revenue multiples in the area. Some firms will have higher revenue multiples and others will have lower revenue multiples.

According to BizBuySell.com, the median revenues for its Fremont business-for-sale listings was $425,000 in Q3 2009.

To put this in perspective, the Q3 2008 revenue multiple was 0.77 and the median revenue for listed Fremont businesses was $420,000.

Cash Flow Multiples for Fremont, CA Businesses

The table below shows how cash flow multiples are trending in the Fremont area, based on BizBuySell.com's quarterly reports.

Quarter
Median Cash
Flow Multiple
Q1 2007
3.18
Q2 2007
3.14
Q3 2007
3.42
Q4 2007
3.48
Q1 2008
3.45
Q2 2008
3.35
Q3 2008
3.29
Q4 2008
3.13
Q1 2009
3.08
Q2 2009
3.05
Q3 2009
2.99

As you probably know, cash flow multiples are another common way to value a business.

For Q3 2009, the average cash flow multiple for listed businesses in the San Francisco-Oakland-Fremont, CA metro area was 2.99.

So, a firm with cash flows of $110,000 might list for $329,344. That calculation is dependent on the business selling for the area's average multiple. Cash flow multiples will usually vary considerably based on many factors.

In case you were wondering what typical cash flows are for a business in Fremont, BizBuySell.com reports that the median cash flow for Fremont area businesses was $91,590 in Q3 2009. In Q3 2008, Fremont cash flow multiples averaged 3.29 and the median cash flow was $99,295.

Number of Fremont Businesses for Sale in the Dataset

The study data comprised 297 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 probably representative of Fremont business valuations.

One year ago, in Q3 2008, the BizBuySell.com dataset for Fremont spanned 427 listings. The downward trend in the number of Fremont business-for-sale listings is indicative of the current down economy.

Should I Sell My Fremont, CA Business Now?

You can absolutely sell in this market. Deals are getting done every day. You just have to structure the deal properly. In this down economy, performance based pricing is very popular. When buyers and sellers differ on valuations, tools such as earnouts, equity ownership or profit sharing can bridge the valuation gap. In effect, this is a deferred purchase price, but it's a way to get a deal done in a tough economic climate. 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 thinking about buying a business or selling a business and would like to determine how much a business is worth, we recommend the BizBuySell.com Business Valuation Tool. Based on your specific criteria, you can modify the company dataset that creates business valuation estimates. Access to the tool is very reasonable -- costing less than $100.

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.

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