With the myriad of products and services being bought and sold online, why not do the same with businesses?
Enter bizbuysell.com, which offers a venue for business owners to sell or hopeful business owners to buy an established business – all online. Information about businesses on the market is laid out by business type and geographic location, and, if disclosed, the asking price.
One of these business sectors on the site is landscaping and lawn care. The site reports facilitating the sale of 20 businesses in this market in the third quarter of 2008.
Even in the poor economy, the small-business marketplace remains hopeful, says Mike Handelsman, general manager of the site. There are more entrepreneurs out there looking for opportunities, driving the supply down and the business prices up.
Casual browsers on the site won’t always be able to look just to see exactly which of their competitors are for sale. Many times, a business’ name might not be listed on the site because the owner doesn’t yet want the employees to know the business is for sale, Handelsman says, adding some businesses don’t want the asking price disclosed on the site, either.
Once a business is sold, Bizbuysell uses the data in a quarterly report that offers insight into the state of small businesses. In the third quarter of 2008, the median sale price of a landscaping or lawn-care business was $201,500.
For these transactions, the average sale-price-to-asking-price ratio was .92. The median revenue was $303,986, while median cash flow was $106,759.
Based on the data, bizbuysell.com calculated the multiples that companies are getting these days. The average multiple of revenues is .62 while the average multiple of cash flows is 1.47.
The site’s landscaping & yard service data is based on actual sales as reported by business brokers, not on the for-sale listings. So, it's likely that BizBuySell.com helped sell more landscaping & yard service businesses. The company just didn’t learn they sold for.
The site, which has been around since 1996, doesn’t require prospective buyers to register on the site before browsing the businesses.