1. The basics of BizBuySell
What is BizBuySell?
BizBuySell is one of the largest online marketplaces for you to buy or sell a business. Launched in 1996, at any time BizBuySell has listings for more than 45,000 businesses. BizBuySell has monthly site traffic of up to 1.4 million unique visitors, which increases the chance that your business listing will be seen by an interested buyer.
BizBuySell is more than just a marketplace, however. It provides important services to its customers. You can not only buy or sell a business on the platform, but you can also lease office space, buy or sell real estate, and access exclusive reporting and databases on business and real estate. BizBuySell has partnerships with LoopNet, Inc.com, USA Today Network, CityFeet.com, and The Wall Street Journal Online.
If you’re interested in buying or selling a business, or you’re interested in any of BizBuySell’s other services, keep reading for a detailed explanation of the pros and cons of using BizBuySell.
Pros and cons of BizBuySell
Now let’s dive into the pros and cons of BizBuySell.
2. Buying a business on BizBuySell
What is the process for buying a business on BizBuySell?
Buying a business on BizBuySell starts with deciding what you’re looking for. This can mean filtering your search by business type (e-commerce, physical, franchise, etc.), business field (retail, food, automotive, etc.), and location. Once you’ve found a listing you’re interested in, the next step is to evaluate whether the asking price is fair. This is an important step and may require professional advice from a broker to ensure you don’t overpay.
Once you’ve secured funding for the purchase, you’ll submit a letter of intent to the business owner that lays out your offer and plans for the business. If accepted, you will complete a purchase and sale agreement, which is a contract prepared by a broker or attorney.
What is BizBuySell pricing?
Businesses are available for sale on BizBuySell at a wide range of prices, everything from $60 million franchise groups to mom-and-pop shops that go for a few thousand dollars. BizBuySell’s cost can differ widely by industry, location, and business size. Generally, businesses are valued at 3 to 6 times annual cash flow. This can be a good rule of thumb to see if the price is reasonable.
So, for example, a convenience store listed on BizBuySell for $450,000 that generates an annual cash flow of $200,000 could be a good deal based on earnings multiple alone. You’ll get a chance to look more deeply into a business’s finances during due diligence as you prepare your purchase and sale agreement.
Types of businesses on BizBuySell
You may be coming to BizBuySell for online businesses or e-commerce, but these are not the only business types for sale on the website. You can find everything from daycares to cleaning services and gas stations for sale on BizBuySell. And, of course, you can also find a vast array of online businesses and e-commerce businesses, too.
The top five business types for sale on BizBuySell are:
- Restaurants & Food
- Service Businesses
- Retail, Automotive & Boat
- Building & Construction
Things you need to know before you buy a business on BizBuySell
Before you buy a business on BizBuySell, you need to remember that BizBuySell is an online marketplace and not a broker. As such, they provide only limited oversight of listings on their platform, so you should do your own due diligence before buying a business from the site. It’s best to involve a professional in this process if you are not an experienced buyer of businesses. Due diligence can include confirming the values in a business’s financial statements, conducting background checks on the business and seller, and more.
If you are purchasing re-sold franchise rights on BizBuySell, you should be careful to confirm that the franchise rights are official and, therefore, regulated by the Federal Trade Commission (FTC). This ensures your rights are protected. BizBuySell is known for hosting listings marked as franchises that are not actually official franchises and, therefore, do not come with FTC protections. Be sure to always read the fine print!
3. BizBuySell businesses for sale
How to make your business ready for sale
If you’re looking to list your business on BizBuySell, it would benefit you to make sure it’s ready for sale. This will help you get the highest price. Getting your business ready for sale can be much like getting your home ready for sale: you’re making the necessary investments to ensure that your business is an attractive purchase for interested buyers.
These may include investments in better equipment, process improvements, and other changes aimed at maximizing the cash-making potential of your business – and, therefore, its attractiveness to buyers. Getting your business ready for sale also means getting its financial reports in order so that you can prove its profitability.
Things you need to do before listing your business on BizBuySell
Before you list your business, you need to value it. This can be done with the help of professionals (a free valuation is part of the BizBuySell Basic and Showcase Ad
tiers!) or by yourself. Businesses are typically valued at somewhere between 3 and 6 times annual cash flow, which is an important reason to make sure your cash flow is high as you prepare to sell. Earnings multiples also tend to vary by industry and location, so it can be helpful to research similar business sales in your category and region when setting a price for your sale.
Having an exit strategy is an important part of preparing to sell your business. These are all about driving up the value of your business by making improvements to efficiency and marketing that increase cash flows quickly and maximize your sale price.
The process to sell the business on BizBuySell
The process of selling your business on BizBuySell is really quite easy. Follow our step-by-step guide:
- Generate a listing. Attach images, videos, and marketing materials that explain its selling points and valuation.
- Pay for your ad (see more about pricing in the next section). One of BizBuySell’s big advantages is the speed with which you can complete this whole process. It’s possible to get your business listing up within 24 hours.
- Review the letters of intent you receive from interested buyers. Many sellers report that they receive multiple letters of intent from interested buyers within their first week.
- Choose an offer from among the letters of intent you received.
- Complete due diligence on your chosen buyer. During this phase, the buyer confirms the details and finances of the business, and the seller confirms the buyer’s financial ability to make the purchase. This process is very similar to the sale of real estate, but it is made more complicated by the intricacies of understanding how a business operates and makes money.
- Create a purchase and sale agreement, which is a legal contract that defines the details of the transaction. This agreement should be prepared by a broker or attorney and is a legally binding contract document.
- Transfer the business to the purchaser according to the terms of the contract – and receive your well-earned payment!
How much does BizBuySell charge for selling a business?
You have two primary options when listing your business on BizBuySell: the Basic Ad and the Showcase Ad. Let’s take a look at the differences below:
|The Basic Ad||$49.95 / month for 6 months||
|The Showcase Ad||$69.96 / month for 6 months||
Both ad tiers are very competitively priced compared with broker’s fees, which may run from 5% to 15% of the sale price of the business.
4. Key takeaways: buying or selling a business on BizBuySell
Overall, BizBuySell is a great place to get your business listing noticed thanks to its huge and diverse catalog and helpful services to assist you in the valuation and sale of your business. BizBuySell is a top destination for buyers and sellers of online and e-commerce businesses.
Turnkey Websites Online, a top developer of turnkey websites that allow people to start businesses at low risk and low cost, has produced many online businesses that have sold for significant sums on BizBuySell. Also, Turnkey Websites Online has excellent tech support to make sure your website stays up and running 24/7. TurnKey Websites Online also offers an unique auto-blogging feature that other competitors do not have, which saves you time and allows you to focus on your business. The website will help you add active blog content, to help you rank high on search engines and attract new customers.
Turnkey Websites Online is a great place to get started in business with the end goal of selling through BizBuySell and making your financial dreams a reality. Check out their website to learn how to get started.