Transition to a buyer-dictated market.
In recent times, the market has made the switch over to a buyer-dictated market, where purchasers are feeling more comfortable about having a say in their investment. We are seeing buyers having the means to be more particular with businesses that they may potentially be interested in, and they have the perception to have more freedom in making their opinions known in the pricing of an advertised business. However, lending often remains a challenge for buyers, but isn’t entirely out of reach so long as buyers are prepared and have planned ahead for their investment.
So, what does this mean for our vendors?
With this shift, it means that now more than ever, vendors need to ensure that they have their business in the best shape for entering the sales market – with making sure that they have up-to-date books and contracts, ensuring that year-to-date figures are accurate, and everything related is organised.
Confidentiality becomes increasingly important to businesses on the market.
We have always known that confidentiality is critical when managing the sale of a business. This has become even more important now with staff shortages throughout New Zealand and beyond.
We are often finding that some vendors are hesitant about placing their business on the market, as they fear that this will push their staff away if they were to find out about the potential sale.
Due to this, it is more important than ever that vendors engage with a trusted Business Broker when they want to put their business on the market. This is to ensure they can be guided through the beginning-to-end process, managing the confidentiality and staff requirements with professionalism and experience.
Why is now a good time for buyers?
As a buyer, now is a great time to invest. There are still hundreds of businesses out there that must be sold due to an influx of baby boomers exiting the market.
These businesses can have huge opportunities within them for growth. Often, just a few simple changes need to be made to modernise them and increase relevance in current times.
For example, implementing social media platforms or streamlining computerised systems.
Particular industries are thriving.
There are some industries that are doing extremely well at the moment. Manufacturing is booming as usual, especially in the food sector.
We are also seeing a rise in success of online and tech businesses, as well as wholesale. Despite the Covid-19 slump, businesses are beginning to emerge and even flourish into a healthy and profitable investment.
