The value of businesses has increased above pre-pandemic levels. According to Morgan Business Sales, one of the biggest business brokerage firms in Australia, business valuations have increased to record levels.
Morgan Business Sales Director Dru Morgan believes that a decrease in macroeconomic uncertainty is behind this.
“A key factor in a business valuation is buyer demand. Think of your Economics 101 supply and demand chart.
At the peak of the pandemic, there was an understandable drop in buyer demand. Buying a business is a big decision at the best of times. The pure uncertainty regarding lockdowns, travel and logistics was enough to discourage many potential buyers. Now that the pandemic is better understood and managed, we’re seeing a shift back to normal buyer demand levels. The flow on effect is higher business valuations.”
According to Mr Morgan, the fluctuation in business valuations hasn’t been isolated to obvious sectors. Rather valuations have been rising across the board.
“While valuations for sectors like travel have experienced more extreme variability than other industries, it’s the same trend line. Valuations down during the start of the pandemic. Then slowly increasing to be back above pre-pandemic levels now.”
Mr Morgan says that many business owners who were impacted by the Pandemic are taking advantage of the current opportunity to sell.
“The chances of another Covid-sized economic event in the short term is highly unlikely, but not impossible. A number of the sellers we’re working with at the moment recognise this. They had a tough time during the pandemic and are now looking to cash out while the demand is there”
About Morgan Business Sales
Morgan Business Sales are Australia’s leading Specialist Business Brokers. For the past 25 years, they have successfully sold hundreds of large and small businesses. Whether looking to buy or sell, they are ready to assist you.
From Business Valuations, Franchise sales, to corporate sales, and large business sales to the very smallest business sale, their experienced team of Specialist Business Brokers are ready to achieve a great result for you. Learn more about Morgan Business Sales via their website here: www.morganbusinesssales.com
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Disclaimer: The views, suggestions, and opinions expressed here are the sole responsibility of the experts. No PITCH SCOOP journalist was involved in the writing and production of this article.