Small Businesses Changed Hands Last Year At Fastest Rate Since Recession

Date: January 15, 2014

Boom Driven By Improving Economy

On Monday, BizBuySell, an online marketplace that links up small-business sellers with potential buyers, issued a report that said that more than 7,000 small businesses changed hands in 2013, up from about 4,700 in 2012. That’s the fastest rate of turnover since the start of the recession in 2008. BizBuySell’s Curtis Kroeker said that 2013 was “the year of recovery that everyone has been waiting for.” He added that the low level of transactions in recent years had resulted in “pent-up supply and demand that needed the right economic and capital conditions to materialize.” Last year, he said, “those conditions finally came together resulting in a large increase in business transactions and contributing to a healthier small business environment overall.”

What This Means For Business:

The report suggests that 2014 is likely to see the number of small businesses changing hands continue to increase, though the rise is unlikely to match 2013’s impressive growth rate. The economic conditions that drove the 2013 increase are expected to improve further in 2014, with more potential buyers with sufficient capital to pursue acquisitions. In addition, more baby boomers are approaching retirement and will likely be looking to sell their businesses, increasing the supply available for acquisition.

Further Reading:

The Washington Post and Fox Business also cover the story. The Post piece notes that NFIB’s Small Business Optimism Index rose in December, and that small businesses hired at their strongest rate since February 2006. Ohio’s Columbus (OH) Business First provides an example from a local perspective.

This news article is intended to keep small business owners apprised of current events that may affect them. It does not necessarily reflect NFIB’s policy position on such issues.

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