Selling Your Business During A Pandemic

For the past 15 months, business owners have faced unprecedented times and challenges. Every business has felt the impact of Covid-19, in some cases in a positive way but in most cases in a negative way.

Mergers & Acquisition activity has rebounded and in fact the start of 2021 has surpassed activity levels in the first quarter of 2019. The reasons why are pent up demand from buyers, low interest rates and that the baby boomers, who own most businesses, have aged another two years and want to sell and retire.

Buyers are looking for the following indicators:

• The business was able to adapt during the height of the pandemic;
• The pandemic has not caused any negative fundamental changes to the business;
• There is no “Covid bubble” where revenues have increased and will return to normal after the pandemic is past; and
• That after the pandemic the business will continue to grow or have the ability to grow.

The message to business owners is that you do not have to wait until 2022 or beyond to put your business up for sale.  Start planning the process now such that after the pandemic starts to recede your business is ready to be sold.

There is now a vibrant market again with plenty of buyers chasing deals but experts are now warning of a Tsunami of business sales from aging business owners that could significantly reduce valuations over the next few years as more and more businesses are put up for sale.

In an article in ProfitGuide.com, Doug Robbins, founder and president of Robbinex Inc., a nationwide business brokerage based in Hamilton, Ont., says that;

“as soon as the North American economy regains predictable, stable growth, pent-up supply could flood the marketplace. As thousands of owners confront too few buyers, the winning companies will be those that start planning now to create the conditions for success.”

The message is clear; the time to start planning a viable succession for your business is now.

Contact the Summit Group for a free, no obligation consultation and we will provide you with the advice and the tools to ensure that you make the best decisions possible.