October 1, 2020  
 
  Articles for Entrepreneurs  
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Q3 2009 Business Valuation Data

 

 

Sell My San Francisco, CA Business

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

Median Ask Prices for San Francisco, 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, San Francisco 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. The lower median asking price in last quarter suggests that San Francisco, CA 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 San Francisco, CA Businesses

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

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 businesses will usually sell for 0.71 times the selling company's revenues. The data from BizBuySell.com indicates that is 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 strictly 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 San Francisco 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 San Francisco businesses was $420,000.

Cash Flow Multiples for San Francisco, CA Businesses

Here is how cash flow multiples are trending in the San Francisco 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. Most businesses will not conform to industry- or area averages.

If you are interested in what cash flows are for a business in San Francisco, BizBuySell.com reports that the median cash flow for San Francisco area businesses was $91,590 in Q3 2009. In Q3 2008, San Francisco cash flow multiples averaged 3.29 and the median cash flow was $99,295.

Number of San Francisco 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 San Francisco, but they are nearby and so are probably representative of San Francisco business valuations.

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

Can I Sell My San Francisco, CA Business Now?

You can sell a business in any market if you know what you are doing. If you wait for the perfect time to sell a business, you may find that that perfect time never comes. This advice comes from Domenic Rinaldi, managing partner of Chicagoland Sunbelt, a leading business brokerage firm.

Business Valuations for San Francisco, CA 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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