2022 has generally been a solid year for business brokers, where there has been both a good supply of businesses for sale as well as consistent demand from purchasers.
At this stage, the positive market sentiment looks set to continue in 2023. Brokers are reporting that buyers seem mainly undeterred by higher interest rates on business loans. This is likely due to the fact that most small businesses transact at prices reflecting a profit multiple range of around one to four times (ROI 25% to 100%) ie. meaning that loan repayments are well covered by the profit being achieved on the business purchased. Small to medium businesses also provide a comparatively high yield when compared to other investments.
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