Right now, economic news dominates many of our feeds – partly because conditions have changed so rapidly since 2020.
Some of the largest public companies are announcing record profits, while others are announcing their first layoffs in years. And according to the Wall Street Journal, most CEOs are bracing for a recession as consumer spending starts to sputter.
There is a lot of data out there, and most of it isn’t hopeful. So, it’s natural to assume this is not a great time to sell. And while that might be true for some, it’s definitely not true for others.
Two truths and a lie about the current market conditions
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LIE:
The value of a company, or the market for it, goes up and down with the economy or the stock market. That is simply not true. But it’s the perception because the value of a company is tied to its profits, and many companies experience reduced sales or profits in a down economy.
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TRUTH:
The truth is there are always buyers for strong, growing, and profitable companies. In fact, when the economy is soft and fewer companies are performing well, there are more buyers competing for relatively fewer sellers. So, companies that thrive during challenging economic conditions become even more valuable if they are marketed correctly.
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TRUTH:
Economic conditions can change rapidly. The last few years only prove that, and it’s good news for businesses that are negatively impacted by the current economy. If your clients are nearing retirement and waiting for business to recover, then this is the perfect time to plan for a future sale. With the right moves, an owner can increase their company’s value by 20-30% or more.
ASG Partners has been selling companies in the Pacific Northwest for 40 years and helping business owners plan for their eventual retirement. If you’d like to know how buyers will view your business today or how to make it more valuable in the future, we can help.
