SAN FRANCISCO -- One business-for-sale marketplace anticipates 2014 will be a record-breaking year for small-business transactions, including a healthy year for convenience store and gas station business acquisitions.
BizBuySell.com said a total of 1,987 closed transactions were reported in the third quarter this year, representing both a 17.9% increase from last year and the highest number of small-business sales recorded in a third quarter since BizBuySell began tracking data in 2007.
That transaction total includes 76 convenience store business sales, up from 70 the previous year, and 55 gas station or service station business sales, a small dip from last year's 59 deals.
This quarter's total numbers slipped just 2.1% from the second quarter of 2014, which remains the most-active quarter for small-business sales since before the recession. It also keeps 2014 on pace to record the highest number of small-business transactions since the report's inception.
"After seeing a return to robust transaction activity during 2013, it's good to see that we have not plateaued and both buyers and sellers are still eager to make deals happen," said Bob House, group general manager of BizBuySell.com and BizQuest.com. "There remains a strong supply of quality small businesses on the market. As the economy and financing options continue to improve, buyers remain very interested in acquiring small businesses."
A Sellers' Market?
While the post-recession market has generally favored buyers, a shift appears under way, with sellers now receiving higher sales prices. The median sale price for businesses sold in the third quarter rose 5% compared to last year, increasing from $180,000 to $189,000--and at $120,000 for convenience stores.
Meanwhile, the median asking price remained virtually unchanged, rising just 0.5% from $199,000 to an even $200,000. The median asking price for convenience store businesses sold in the third quarter of 2014, according to BizBuySell.com's records, was $139,900.
This means sellers in the third quarter were able to receive roughly 95% of their asking price, the highest percentage BizBuySell has reported since the recession hit in mid-2008.
There were also a growing number of businesses listed for sale. Total listings were up 2.2% from the same time last year, with the most notable growth in manufacturing businesses (up 4.1%), service-industry businesses (up 3.9%) and restaurants (up 3.5%).
BizBuySell.com, San Francisco, is the Internet's largest marketplace for buying or selling a small business, with more than 1.2 million monthly visitors.
Convenience Stores
| Quarter | Number | Median Sale Price | Median Ask Price | Avg. Sale/Ask Ratio | Median Revenue | Multiple of Revenue | Median Cash Flow | Multiple of Cash |
|---|---|---|---|---|---|---|---|---|
| Q314 | 76 | $120,000 | $139,900 | 0.92 | $468,250 | 0.39 | $75,250 | 1.96 |
| Q214 | 66 | $120,000 | $149,500 | 0.86 | $519,500 | 0.29 | $85,000 | 1.89 |
| Q114 | 71 | $185,000 | $235,000 | 0.91 | $540,000 | 0.43 | $100,000 | 2.19 |
| Q413 | 81 | $190,000 | $200,000 | 0.89 | $610,830 | 0.47 | $105,000 | 2.25 |
| Q313 | 70 | $177,500 | $192,500 | 0.92 | $639,500 | 0.31 | $114,000 | 2.27 |
| Q213 | 90 | $175,000 | $199,500 | 0.88 | $582,500 | 0.37 | $117,500 | 2.05 |
| Q113 | 81 | $125,000 | $159,000 | 0.90 | $447,196 | 0.32 | $100,334 | 1.88 |
Gas Stations
| Quarter | Number | Median Sale Price | Median Ask Price | Avg. Sale/Ask Ratio | Median Revenue | Avg. Multiple of Revenue | Median Cash Flow | Avg. Multiple of Cash Flow |
|---|---|---|---|---|---|---|---|---|
| Q314 | 55 | $250,000 | $250,000 | 0.94 | $1,200.000 | 0.58 | $129,600 | 3.19 |
| Q214 | 94 | $192,500 | $202,500 | 0.92 | $530,950 | 0.38 | $116,400 | 2.62 |
| Q114 | 55 | $477,500 | $477,500 | 0.92 | $680,000 | 0.81 | $176,147 | 2.41 |
| Q413 | 70 | $190,000 | $199,500 | 0.94 | $371,154 | 0.54 | $112,575 | 2.65 |
| Q313 | 59 | $245,000 | $245,000 | 1.00 | $552,000 | 0.52 | $130,555 | 3.07 |
| Q213 | 82 | $350,000 | $300,000 | 1.05 | $900,000 | 0.50 | $166,000 | 2.40 |
| Q113 | 74 | $362,500 | $375,000 | 0.94 | $550,000 | 0.85 | $162,035 | 2.79 |
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