Metro Vancouver, BC is the third largest city in Canada behind Montreal and Toronto. At any one time, there are a healthy number of businesses in all sectors on the market for sale.
Prior to the sale of any business, the value of the business needs to be determined. Some people find an average multiple for the business and use it to find the value of their business. However, a better and assuring way would be to use a professional small business valuation service to properly determine the price of the business and any assets within.
As this region has experienced an incredible amount of real estate boom in the last two decades causing home equity of many locals to increase.
This increase in home equity of locals has created an interesting situation for business buy and sell transactions. Many business buyers in the Vancouver area tap into their home equity to finance a purchase of a business.
For this reason, Business Valuations in Vancouver tend to price local businesses here a little higher due to the buyer pool being able to access more credit via home equity.
Once business valuation has been determined, a business owner can then decide to sell the business himself or engage a business broker to find buyers. Brokers typically charge between 8-12% of the total sale price of a business which many business owners find expensive.
There are several channels where a business owners can put the business on the market to attract interested buyers. Most owners and brokers list them on large “business for sale” websites like BizBuySell, or businessesforsale.com.
If confidentiality is a concern or a business owner wants to be more targeted in finding a buyer, they can talk to their accountants and lawyer to see if any of their clients are interested to buy a competitor, supplier, or customer. Alternatively, they can also check with business contacts and friends first.