2024 Business Sales Market: Common Themes our Data Reveals
As the saying goes, “The numbers don’t lie”; and based off what they’re telling us, 2024 holds a promising market for business sale transactions.
BizBuySell’s insight report reflects what our data at Transworld Business Advisors is showing us. 2024 is picking up steam with volume, prices and in surprising industries.
As discussed in a recent episode of Transworld’s podcast, The Deal Board, here are the common themes we’re seeing in the business sales market:
Small Business Sales are on the rise
The business sales market is going strong, with small business acquisitions having grown 10% from 2023 – and even up since 2019’s strong market. In the first quarter of the year, over 2,400 businesses changed hands, indicating there’s a strong demand for business acquisitions.
Larger deals are getting done
Of the 2,400 business transactions in the first quarter, BizBuySells insight report revealed a total transactional value of $1.8 billion in the first quarter, up 24% from 2023. Also, Transworld’s one million dollar plus deals are up 20% since last year. These igures indicate that average sales prices are up and larger deals are getting closed.
Buyers have normalized the interest rates
Even though rates have not come down, buyers seem to be getting used to the rates and are more comfortable with acquiring businesses regardless of the rates. Historically, it’s less about what the rate actually is, but more about how quickly the rates escalated in terms of buyer perception. While buyers paused and were looking for some certainty in 2023, today’s buyers are feeling confident that the rates will stay the same.
Restaurant Sales Prices are up
The Restaurant industry is making a comeback. Surprisingly, restaurant sale prices are up as buyers are paying a premium for high performing restaurants. With high build out and permitting costs for new restaurants, buyers are seeking out high-performing 2 nd generation restaurants, chains and franchises instead.
Also attributing to the industries’ higher sale prices are buyers peaked interest in high- end restaurants. While median sales prices are up, so are median cash flow, which is up 4% from 2023, indicating the restaurant industry has hit its stride and buyers are responding well.
Small retail businesses are coming to market
Compared to 2023, retail acquisitions are up 10%, with lots of opportunities in the small retail space. This uptick in acquisitions and slightly lower price average suggests more sellers in this space are motivated to close deals.
Although the increase in volume was also made up of lower priced deals, this is a positive reflection of the market, as smaller sized deals are moving and the buyer opportunity to get a good value deal is promising.
These positive market indications for 2024 are exciting and hold promise for a strong business sale market through the 2 nd half of the year. If you’re interested to learn more about what we’re seeing in the current business sale market, contact Transworld Business Advisors of Boston at [email protected] or call 855-652-8922.
