More Than Half of Small Business Buyers are Under 50
If you’re looking to sell a business this may be the time — and you may want to look for buyers under the age of 50.
The 2018 Small Business Owner & Buyer Demographics study by BizBuySell has revealed 53% of small business buyers are under the age of 50. But the largest percentage of buyers in a single age bracket are between the age of 50 and 59 years old at 32%, the survey says.
BizBuySell Q1 2018 Insight Report
According to BizBuySell, around 10,000 small businesses changed hands in 2017 across the United States, which was a 27% year-over-year increase. And increasingly, the buyers are getting younger than existing owners.
For small business owners looking to sell their business, BizBuySell is reporting this is a great time to make it happen because deals are closing faster at record high average sales prices.
In the comapny’s First Quarter 2018 Insight Report, Bob House, president of BizBuySell.com and BizQuest.com, explained:
“Both buyers and sellers are in a really good position right now. With healthy financials, owners are able to secure a great return, while buyers are taking ownership of valuable businesses. Whether you’re a business owner looking to sell or an entrepreneur searching for a new venture, the window is open to take advantage of the strong market.”
BizBuySell carried out the survey with the participation of 2,300 small business owners and buyers across the US to determine the driving factors for their decision.
Some of the Survey Results
The report revealed some further interesting trends. For example, 77% of buyers in the survey were male while 23% were female. A similar ratio was seen among sellers with 78% being men 22% being women.
Among potential buyers surveyed, 21% said they planned to purchase a business in less than 3 months while another 18% said it would more likely be in 3 to 6 months. Another 19% indicated a business purchase might be 6 to 12 months away. More than a quarter of those surveyed or 26% said they are currently looking to buy a business.
Among the challenges they face in their efforts, more than half or 58% of potential buyers said it was finding the right business while understanding how much a business should be valued was a difficulty for 13% of respondents.
Another 12% gave coming up with a down payment as their chief concern, while 10% said the greatest challenge was getting approved for financing.
Negotiating the price with the previous owner seemed the least of buyers’ concerns with only 2% mentioning this as an obstacle.
Buying a Small Business
BizBuySell calls itself the largest business for sale marketplace on the internet, currently holding an inventory of approximately 45,000 businesses in 80 countries around the world. The company says it strives to create an acquisition experience in which both small business owners and potential buyers receive valuable insights into the state of the market at any given moment.
Whether you are buying or selling a business, having these insights may assist you in getting the best deal.