September 22, 2020  
 
  Articles for Entrepreneurs  
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Q3 2009 Business Valuation Data

 

 

Sell My Indianapolis, IN Business

BizBuySell.com has just released its Indianapolis, Indiana business-for-sale statistics.

Median Ask Prices for Indianapolis, IN Businesses

If you are interested in trends in business-for-sale asking prices, here are the median asking prices for companies in the Indianapolis-Carmel, IN metro area for the last 11 quarters.

Quarter

Median Ask

Q1 2007

$155,000

Q2 2007

$180,000

Q3 2007

$257,500

Q4 2007

$277,000

Q1 2008

$257,000

Q2 2008

$250,000

Q3 2008

$250,000

Q4 2008

$242,500

Q1 2009

$250,000

Q2 2009

$250,000

Q3 2009

$210,000

As you can see from the chart above, Indianapolis business-for-sale listings in Q3 2009 had a median asking price of $210,000.

That compares to a median ask price of $250,000 in Q3 2008. The lower median asking price in last quarter suggests that Indianapolis, IN sellers are dropping their asking prices in light of market conditions. This is making it possible for more business-for-sale transactions to close.

Revenue Multiples for Indianapolis, IN Businesses

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

Quarter

Revenue Multiple

Q1 2007

0.70

Q2 2007

0.73

Q3 2007

0.90

Q4 2007

1.01

Q1 2008

1.03

Q2 2008

0.85

Q3 2008

0.86

Q4 2008

0.76

Q1 2009

0.76

Q2 2009

0.76

Q3 2009

0.71

In the Indianapolis-Carmel, IN 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 firm with revenues of $150,000 might list for $106,785. Keep in mind that this is just an average for revenue multiples in Indianapolis 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 Indianapolis business-for-sale listings was $381,031 in Q3 2009.

As a reference point, the Q3 2008 revenue multiple was 0.86 and the median revenue for listed Indianapolis businesses was $365,192.

Cash Flow Multiples for Indianapolis, IN Businesses

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

Quarter

Median Cash
Flow Multiple

Q1 2007

3.66

Q2 2007

3.41

Q3 2007

4.09

Q4 2007

4.41

Q1 2008

3.74

Q2 2008

3.47

Q3 2008

3.38

Q4 2008

3.02

Q1 2009

3.46

Q2 2009

3.10

Q3 2009

3.21

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 Indianapolis-Carmel, IN metro area was 3.21.

So, a company with cash flows of $110,000 might list for $353,373. That calculation is dependent on the business selling for the area's average multiple. Most businesses will not conform to industry- or area averages.

If you are interested in what cash flows are for a business in Indianapolis, BizBuySell.com reports that the median cash flow for Indianapolis area businesses was $82,452 in Q3 2009. In Q3 2008, Indianapolis cash flow multiples averaged 3.38 and the median cash flow was $85,500.

Number of Indianapolis Businesses for Sale in the Dataset

The study data comprised 96 listings in the Indianapolis-Carmel, IN metro area. As such, some of the businesses used to derive the median valuation might be outside of Indianapolis, but they are in the area and so are likely representative of Indianapolis business valuations.

One year ago, in Q3 2008, the BizBuySell.com dataset for Indianapolis spanned 104 listings. In a market where you would think fewer business owners would be selling, it's a bit surprising to see more Indianapolis business-for-sale listings.

Should I Sell My Indianapolis, IN Business Now?

The decision to sell now or wait until later should be based on your own personal circumstances and your business's circumstances. A short consultation with a business broker can help you determine whether now is the right time to sell. This useful tip comes from Domenic Rinaldi, managing partner of Chicagoland Sunbelt, a leading business brokerage firm.

Business Valuations for Indianapolis, IN Businesses

If you are contemplating buying a business or selling a business and would like to look at completed transaction sale price comparables in the area, 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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