OC-LA business sellers seek $225,000
The average asking price for businesses for sale in the Orange-County-Los Angeles area is about $225,000, according to BizBuySell.
That asking price is unchanged from the third quarter, said the businesses-for-sale Web site.
That’s a bargain by national standards. Unlike the housing market where our prices are double and triple other markets, small businesses cost less here. The median asking price for a small business in the United States jumped to $255,000 at the end of the fourth quarter, a $5,000 increase relative to the prior quarter.
Here’s BizBuySell’s explanation why our business prices are lower than the rest of the nation.
In the fourth quarter, businesses listed for sale on BizBuySell had median revenue of $360,000, up from $354,000 in the previous quarter.
The median cash flow, meaning the money that comes out of the business over the course of a year, was $92,052, versus $90,400 in the previous quarter.
In the Orange-Los Angeles counties area, the asking price is, on average, annual revenues times 0.83 and annual cash flow times 3.0 (The revenue multiple was 0.85 and cash flow multiple was 3.0 in the third quarter.)
“In 2008, we expect there to be downward pressure on (Orange-Los Angeles counties) business valuations as retiring baby boomers put their businesses up for sale to fund their retirements,” said Mike Handelsman, general manager of BizBuySell.com.
BizBuySell is the Internet's largest business for sale marketplace. Since 1996, BizBuySell has offered tools that make it easy for business owners and brokers to sell a business, and potential buyers to find the business of their dreams. BizBuySell currently has an inventory of approximately businesses - spanning 80 countries - for sale at any one time and receives more than monthly visits. The site also features an extensive franchise directory as well as an easy-to-use business valuation tool. Please visit www.bizbuysell.com for more information.
BizBuySell was founded in 1996 and in 2012 became a division of CoStar Group, Inc. (NASDAQ - CSGP) - commercial real estate's leading provider of information and analytic services. CoStar conducts expansive, ongoing research to produce and maintain the largest and most comprehensive database of commercial real estate information and offers a suite of online services enabling clients to analyze, interpret and gain unmatched insight on commercial property values, market conditions and current availabilities. For more information, visit www.costar.com.
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