September 21, 2020  
 
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Q3 2009 Business Valuation Data

 

 

Sell My Warren, MI Business

BizBuySell.com has just released its Warren, Michigan business valuation data for Third Quarter 2009.

Median Ask Prices for Warren, 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, Warren 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 Warren, MI median business asking prices appear to be dropping, it suggests that selling Warren businesses may be lowering their prices to make their businesses more attractive to buyers.

Revenue Multiples for Warren, MI Businesses

Here is how median revenue multiples are tracking in the Warren 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 usually 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 just an average for revenue multiples in Warren and surrounding communities. Some businesses will have higher revenue multiples and others will have lower revenue multiples.

According to BizBuySell.com, the median revenues for its Warren 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 Warren businesses was $350,550.

Cash Flow Multiples for Warren, MI Businesses

Here is how cash flow multiples are trending in the Warren 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 businesses listed 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 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 Warren, BizBuySell.com reports that the median cash flow for Warren area businesses was $85,000 in Q3 2009. In Q3 2008, Warren cash flow multiples averaged 3.68 and the median cash flow was $83,000.

Number of Warren 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 Warren, but they are nearby and so are likely representative of Warren business valuations.

In Q3 2008, just one year ago, there were 169 Warren listings in the BizBuySell.com dataset. As a result of the recession, fewer Warren business owners are selling because they hope to weather the storm and sell after the economy turns around.

Can I Sell My Warren, MI Business Now?

While the economy can play a role in deciding whether to sell a business or not, it is only one of many factors. Indications suggest that the economy is turning around, so it's probaby a good time to consider selling right now. Beyond that, though, you have to look at your specific case. Will there be substantial demand for your business? Will you be able to get a good price when selling your company? If not, think about what factors you can control that can make your business more attractive to prospective buyers, and then work diligently to improve your business attractiveness and raise your business valuation. This helpful advice was provided by Domenic Rinaldi, managing partner of Chicagoland Sunbelt, a leading business brokerage firm.

Business Valuations for Warren, MI 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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