The following is from The Privately Held Company Newsletter.
Many owners of small to large businesses were recently side-swiped. Very few saw it coming, but turbulent times are here. Some of these owners put off selling their businesses or, for the time being, put off even thinking about it, much less beginning the process. Now, with the economy in the tank, is it too late to sell or to put the business on the market?
Some business owners will decide to sell despite the times due to illness, personal issues, or because they have already put off retirement. All is not lost! It may not be the best time to sell, but those who elect to go to market may be pleasantly surprised. There are still some compelling reasons why now may be a good time to sell one's business.
First, if many business owners put off selling their businesses due to the current economy, there will be a shortage of companies for sale. And, while the old adage that there is always a market for good companies may be trite, it is also true. If there are fewer companies for sale, then pricing shouldn't be hampered too much. If an acquirer is in the market, they will have to pay what the market will bear. Supply and demand will work for sellers.
Second, the jury is still out on what will happen to the capital gains tax. It is the lowest in many years. There are those who say that it will be raised to pre-Bush times and others who say that there won't be any new taxes for quite a while. Why take chances? What we do know is that the capital gains tax is low now, which could make it a good time to sell. After all, it is the after-tax proceeds that really count.
The newspapers, the Internet, and the television are full of bad news about the economy: car dealers are folding, big box stores are filing for bankruptcy and the stock market is in the doldrums. There is always a demand for good businesses and there are still buyers who want to buy. So, if you are serious about selling, why not call a business intermediary professional to find out what is really happening in the marketplace?
