September 19, 2020  
 
  Articles for Entrepreneurs  
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Q3 2009 Business Valuation Data

 

 

Sell My Livonia, MI Business

We just received the latest Livonia, Michigan business-for-sale statistics.

Median Ask Prices for Livonia, MI Businesses

If you are interested in trends in business-for-sale asking prices, here are the median asking prices for businesses for sale in the Detroit-Warren-Livonia, MI metro area for the last 11 quarters.

Quarter

Median Ask

Q1 2007

$212,500

Q2 2007

$200,000

Q3 2007

$200,000

Q4 2007

$200,000

Q1 2008

$199,900

Q2 2008

$241,000

Q3 2008

$247,000

Q4 2008

$231,000

Q1 2009

$243,500

Q2 2009

$200,000

Q3 2009

$238,000

As shown in the table, Livonia business-for-sale listings in Q3 2009 had a median asking price of $238,000.

That compares to a median ask price of $247,000 in Q3 2008. Given that Livonia, MI median business asking prices appear to be dropping, it suggests that selling Livonia businesses may be lowering their prices to make their businesses more attractive to buyers.

Revenue Multiples for Livonia, MI Businesses

Here is how median revenue multiples are trending in the Livonia area, based on BizBuySell.com's quarterly reports.

Quarter

Revenue Multiple

Q1 2007

0.86

Q2 2007

0.73

Q3 2007

0.92

Q4 2007

0.93

Q1 2008

0.91

Q2 2008

0.98

Q3 2008

0.97

Q4 2008

0.91

Q1 2009

0.87

Q2 2009

0.84

Q3 2009

0.84

In the Detroit-Warren-Livonia, MI metro area, small companies will typically sell for 0.84 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 $125,894. Remember, however, that this is only an average for revenue multiples in the area. Some businesses will have higher revenue multiples and others will have lower revenue multiples.

According to BizBuySell.com, the median revenues for its Livonia business-for-sale listings was $389,138 in Q3 2009.

To give this some context, the Q3 2008 revenue multiple was 0.97 and the median revenue for listed Livonia businesses was $350,550.

Cash Flow Multiples for Livonia, MI Businesses

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

Quarter

Median Cash
Flow Multiple

Q1 2007

3.28

Q2 2007

3.67

Q3 2007

3.79

Q4 2007

3.72

Q1 2008

3.39

Q2 2008

3.68

Q3 2008

3.68

Q4 2008

3.48

Q1 2009

3.55

Q2 2009

3.42

Q3 2009

4.01

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 Detroit-Warren-Livonia, MI metro area was 4.01.

So, a business with cash flows of $110,000 might list for $441,475. 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 Livonia, BizBuySell.com reports that the median cash flow for Livonia area businesses was $85,000 in Q3 2009. In Q3 2008, Livonia cash flow multiples averaged 3.68 and the median cash flow was $83,000.

Number of Livonia Businesses for Sale in the Dataset

The study data comprised 164 listings in the Detroit-Warren-Livonia, MI metro area. As such, some of the businesses used to derive the median valuation might be outside of Livonia, but they are close by and so are probably representative of Livonia business valuations.

One year ago, in Q3 2008, the BizBuySell.com dataset for Livonia spanned 169 listings. The downward trend in the number of Livonia business-for-sale listings is indicative of the current down economy.

Should I Sell My Livonia, MI Business Now?

It can take a long time to get a business ready to sell. The sooner you start the process, the sooner you'll be in good shape to entertain offers from would-be business buyers. This helpful advice on how to buy a business comes from Domenic Rinaldi, managing partner of Chicagoland Sunbelt, a leading business brokerage firm.

Business Valuations for Livonia, MI Businesses

If you are contemplating 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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