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

 

 

Sell My Santa Clara, CA Business

We just received the latest Santa Clara, California business-for-sale statistics.

Median Ask Prices for Santa Clara, 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 Jose-Sunnyvale-Santa Clara, CA metro area for the last 11 quarters.

Quarter

Median Ask

Q1 2007

$189,500

Q2 2007

$239,000

Q3 2007

$265,000

Q4 2007

$250,000

Q1 2008

$249,000

Q2 2008

$249,500

Q3 2008

$250,000

Q4 2008

$260,000

Q1 2009

$260,000

Q2 2009

$295,000

Q3 2009

$275,000

As shown in the table, Santa Clara business-for-sale listings in Q3 2009 had a median asking price of $275,000.

That compares to a median ask price of $250,000 in Q3 2008. Because the median ask price for businesses for sale in Santa Clara has risen year over year, we can conclude that many smaller firms in Santa Clara are holding off on selling.

Revenue Multiples for Santa Clara, CA Businesses

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

Quarter

Revenue Multiple

Q1 2007

0.85

Q2 2007

0.79

Q3 2007

0.71

Q4 2007

0.68

Q1 2008

0.74

Q2 2008

0.78

Q3 2008

0.80

Q4 2008

0.82

Q1 2009

0.88

Q2 2009

0.89

Q3 2009

0.83

In the San Jose-Sunnyvale-Santa Clara, CA metro area, small companies will typically sell for 0.83 times the selling company's revenues. The data from BizBuySell.com indicates that is the mean revenue multiple for Q3 2009 in this metro area.

In other words, a business that has revenues of $150,000 might list for $123,868. Remember, however, that this is just an average for revenue multiples in the area. Some companies will have higher revenue multiples and others will have lower revenue multiples.

According to BizBuySell.com, the median revenues for its Santa Clara business-for-sale listings was $415,743 in Q3 2009.

To put this in perspective, the Q3 2008 revenue multiple was 0.80 and the median revenue for listed Santa Clara businesses was $428,094.

Cash Flow Multiples for Santa Clara, CA Businesses

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

Quarter

Median Cash
Flow Multiple

Q1 2007

2.91

Q2 2007

3.23

Q3 2007

3.00

Q4 2007

2.98

Q1 2008

3.35

Q2 2008

3.28

Q3 2008

3.42

Q4 2008

3.47

Q1 2009

3.60

Q2 2009

3.52

Q3 2009

3.50

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

For Q3 2009, the average cash flow multiple for businesses listed in the San Jose-Sunnyvale-Santa Clara, CA metro area was 3.50.

So, a business with cash flows of $110,000 might list for $384,937. That's only if the firm complies with the local average. Most businesses will not conform to industry- or area averages.

If you are interested in what cash flows are for a business in Santa Clara, BizBuySell.com determined that the median cash flow for Santa Clara area businesses was $106,992 in Q3 2009. In Q3 2008, Santa Clara cash flow multiples averaged 3.42 and the median cash flow was $104,158.

Number of Santa Clara Businesses for Sale in the Dataset

The study data comprised 146 listings in the San Jose-Sunnyvale-Santa Clara, CA metro area. Many of the businesses in the dataset are outside of Santa Clara, but they are in the area and so are likely representative of Santa Clara business valuations.

One year ago, in Q3 2008, the BizBuySell.com dataset for Santa Clara spanned 166 listings. The downward trend in the number of Santa Clara business-for-sale listings is indicative of the current down economy.

Can I Sell My Santa Clara, 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 Santa Clara, CA Businesses

If you are thinking about 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 published quarterly. If you find these trends interesting, take a moment to visit BizBuySell.com Insights Report for more information.

 

 

 

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