September 25, 2020  
 
  Articles for Entrepreneurs  
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Q3 2009 Business Valuation Data

 

 

Sell My Towson, MD Business

We just received the latest Towson, Maryland small business valuation trend data for Third Quarter 2009.

Median Ask Prices for Towson, MD Businesses

If you are interested in trends in business-for-sale asking prices, here are the median asking prices for businesses in the Baltimore-Towson, MD metro area for the last 11 quarters.

Quarter

Median Ask

Q1 2007

$225,000

Q2 2007

$250,000

Q3 2007

$250,000

Q4 2007

$275,000

Q1 2008

$275,000

Q2 2008

$265,000

Q3 2008

$225,000

Q4 2008

$225,000

Q1 2009

$250,000

Q2 2009

$249,000

Q3 2009

$240,000

As shown in the table, Towson business-for-sale listings in Q3 2009 had a median asking price of $240,000.

That compares to a median ask price of $225,000 in Q3 2008. Since the median ask price for businesses for sale in Towson has gone up year over year, we can conclude that many smaller businesses in Towson are putting off selling.

Revenue Multiples for Towson, MD Businesses

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

Quarter

Revenue Multiple

Q1 2007

0.81

Q2 2007

0.83

Q3 2007

0.80

Q4 2007

0.81

Q1 2008

0.84

Q2 2008

0.81

Q3 2008

0.75

Q4 2008

0.75

Q1 2009

0.72

Q2 2009

0.72

Q3 2009

0.70

In the Baltimore-Towson, MD metro area, small companies will usually sell for 0.70 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 $104,930. Remember, however, that this is just an average for revenue multiples in Towson and surrounding communities. Some entities will have higher revenue multiples and others will have lower revenue multiples.

According to BizBuySell.com, the median revenues for its Towson business-for-sale listings was $459,000 in Q3 2009.

To put this in perspective, the Q3 2008 revenue multiple was 0.75 and the median revenue for listed Towson businesses was $409,000.

Cash Flow Multiples for Towson, MD Businesses

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

Quarter

Median Cash
Flow Multiple

Q1 2007

3.15

Q2 2007

3.37

Q3 2007

3.36

Q4 2007

3.35

Q1 2008

3.36

Q2 2008

3.31

Q3 2008

3.10

Q4 2008

3.08

Q1 2009

3.11

Q2 2009

3.06

Q3 2009

3.05

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 Baltimore-Towson, MD metro area was 3.05.

So, a business with cash flows of $110,000 might list for $335,060. That calculation is dependent on the business selling for the area's average multiple. Most businesses will not conform to industry- or area averages.

In case you were wondering what typical cash flows are for a business in Towson, BizBuySell.com found that the median cash flow for Towson area businesses was $100,000 in Q3 2009. In Q3 2008, Towson cash flow multiples averaged 3.10 and the median cash flow was $95,000.

Number of Towson Businesses for Sale in the Dataset

The study data comprised 252 listings in the Baltimore-Towson, MD metro area. As such, some of the businesses used to derive the median valuation might be outside of Towson, but they are nearby and so are likely representative of Towson business valuations.

In Q3 2008, just one year ago, there were 318 Towson listings in the BizBuySell.com dataset. As a result of the recession, fewer Towson business owners are selling because they hope to weather the storm and sell after the economy turns around.

Can I Sell My Towson, MD Business Now?

It is a good time to sell a business. The market is turning and strategic buyers are very active. Many strategic buyers are flush with cash and see a great opportunity to grow market share and top-line revenues. For a selling SMB business owner, there is plenty of opportunity to cash out at a premium price. This advice on selling a business comes from Domenic Rinaldi, managing partner of Chicagoland Sunbelt, a leading business brokerage firm.

Business Valuations for Towson, MD Businesses

If you are considering 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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