This 2009 business transaction year was fairly depressing overall, but there are signs that the recession may be coming to an end. Although activity picked up in the final quarters of the year, the extremely weak first and second quarter which is when many deals seem to get started had very weak activity. Registered buyers in 2008 was down overall by over 25% compared to the prior year with cash available down over 45% which is a large result of loss of equity in U.S. homes. A large portion of business buyers and business owners in the past have utilized equity from their homes to be able to buy or invest in their own businesses. With equity depleted from the housing market dive, the amount at a typical buyer’s disposal has been diminished. The high unemployment pool does have people who have money which could present a new buyer pool of people that are looking to employ themselves by buying a business; this could be great for sellers. Restaurant owners looking to sell need to anticipate what is going on and be prepared to possibly self finance a deal, take less cash, or be very creative in the transaction process. As we stated in 2008, there are plenty of buyers out there, and it’s a matter of time and patience for transactions to be done.
Below find charts summarizing the buyer activity for the year: