10 Aug Around the Web: A Week in Summary
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A recent article from Axial entitled “Lower Middle Market Pursuits: Record Breaking First Half Underscores LMM Resiliency” discusses key findings from Axial’s most recent Lower Middle Market Pursuits report. This report is based on data and analysis of deal activity among Axial’s 20,000+ active members.
Major takeaways from the report include:
- Sell-side activity grew by 8% in the first half of 2022
- Buy-side activity grew by 30% in the first half of 2022
- The average pursuit rate on a TTM basis decreased to its lowest level in 2.5 years
- The assets going to market generally had better fundamentals based on average profit margins
- Buyers preferred assets with higher earnings
Click here to read the full article.
A recent article from Transworld Business Advisors entitled “How Inflation Impacts the Sale of your Small Business” explores the current hot topic of inflation and how it can affect a business sale. Inflation is a very real issue that potential sellers need to consider.
Business owners are likely seeing an increase in costs for materials, services, etc. They might consider raising prices to help offset these costs. But will raising prices lead to a loss of customers?
Some owners may look to cut costs by reducing inventory, trimming budgets, etc. Or they may try to come up with creative ways to increase revenue, however this can be challenging with labor shortages and supply chain issues.
Of course the business could just accept a lower profit margin. However this can hamper growth efforts and can also make the business less valuable when it’s time to sell.
Click here to read the full article.
A recent article from Forbes entitled “The ‘Why’ Of Owning A Business Isn’t Always Simple” explores the notion of why a business owner owns their business. Not to be confused with why they started the business, this question looks to the future.
What do you expect the business to provide you in the future? What do you want to be able to fund with it? Is the business going to be your only source of funding?
Once you identify what it is that you need from your business, you can begin to develop your exit strategy to get there and determine when the time is right to exit.
