September 24, 2020  
 
  Articles for Entrepreneurs  
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Q3 2009 Business Valuation Data

 

 

Sell My New Bedford, MA Business

We just received the latest New Bedford, Massachusetts small business valuation trend data for Third Quarter 2009.

Median Ask Prices for New Bedford, MA Businesses

If you are interested in trends in business-for-sale asking prices, here are the median asking prices for businesses in the Providence-New Bedford-Fall River, RI-MA metro area for the last 11 quarters.

Quarter

Median Ask

Q1 2007

$185,000

Q2 2007

$200,000

Q3 2007

$195,000

Q4 2007

$195,000

Q1 2008

$165,000

Q2 2008

$185,000

Q3 2008

$160,000

Q4 2008

$165,000

Q1 2009

$179,000

Q2 2009

$160,000

Q3 2009

$162,500

As you can see from the chart above, New Bedford business-for-sale listings in Q3 2009 had a median asking price of $162,500.

That compares to a median ask price of $160,000 in Q3 2008. Because the median ask price for businesses for sale in New Bedford has risen year over year, we can conclude that many smaller firms in New Bedford are holding off on selling.

Revenue Multiples for New Bedford, MA Businesses

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

Quarter

Revenue Multiple

Q1 2007

0.77

Q2 2007

0.79

Q3 2007

0.77

Q4 2007

0.81

Q1 2008

0.80

Q2 2008

0.76

Q3 2008

0.75

Q4 2008

0.74

Q1 2009

0.70

Q2 2009

0.70

Q3 2009

0.69

In the Providence-New Bedford-Fall River, RI-MA metro area, small companies will typically sell for 0.69 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 $102,959. Remember, however, that this is only 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 New Bedford business-for-sale listings was $352,944 in Q3 2009.

To put this in perspective, the Q3 2008 revenue multiple was 0.75 and the median revenue for listed New Bedford businesses was $353,300.

Cash Flow Multiples for New Bedford, MA Businesses

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

Quarter

Median Cash
Flow Multiple

Q1 2007

3.34

Q2 2007

3.40

Q3 2007

3.24

Q4 2007

3.32

Q1 2008

3.22

Q2 2008

3.15

Q3 2008

3.20

Q4 2008

3.16

Q1 2009

3.14

Q2 2009

3.14

Q3 2009

3.22

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 Providence-New Bedford-Fall River, RI-MA metro area was 3.22.

So, a business with cash flows of $110,000 might list for $354,603. That calculation is dependent on the business selling for the area's average multiple. The actual distribution on cash flow multiples for a given set of businesses can be quite wide-ranging.

If you are interested in what cash flows are for a business in New Bedford, BizBuySell.com reports that the median cash flow for New Bedford area businesses was $75,000 in Q3 2009. In Q3 2008, New Bedford cash flow multiples averaged 3.20 and the median cash flow was $79,405.

Number of New Bedford Businesses for Sale in the Dataset

The study data comprised 226 listings in the Providence-New Bedford-Fall River, RI-MA metro area. As such, some of the businesses used to derive the median valuation might be outside of New Bedford, but they are in the area and so are likely representative of New Bedford business valuations.

One year ago, in Q3 2008, the BizBuySell.com dataset for New Bedford spanned 240 listings. The downward trend in the number of New Bedford business-for-sale listings is indicative of the current down economy.

Can I Sell My New Bedford, MA 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 Chicagoland Sunbelt, a leading business brokerage firm.

Business Valuations for New Bedford, MA 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 suggest you try 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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