Lester de Vere & Richard Stevens are probably the Shore’s leading Business Brokers. Born and bred on the Shore they represent ABC Business Brokers in their home patch. They have spent many years in business themselves before taking on the role at ABC. Their passion is to 'help vendors transition through the sales process and creating a win-win for both seller and purchaser' Lester is ABC’s No.1 Auckland Salesperson in 2018 & 2020 and being named ABC’s Trusted Advisor of the Year 2018. Richard awarded the Rising Star of the Year 2020.
Demand data points, such as signed confidentiality agreements by prospective buyers and website traffic patterns, are showing significant increases (>20%) compared to the same period last year.
Supply data points, such as new businesses listed for sale, are showing material decreases (<20%) both at a total market level and ABC level.
The excess demand and reduced supply characteristics of the current market have resulted in elevated prices for businesses in all industries apart from hospitality and tourism.
Signed confidentiality agreements completed by potential purchasers have increased by 24% when comparing March 2020 to March 2021.
Under level 4 lockdown in April 2020, there was a significant drop-off when uncertainty was at its highest.
Post April-20 enquiry levels accelerated to exceed the previous year and this is driven by the three key demand factors at play:
• Returning expats,
• Newly unemployed looking to business ownership to replicate lost income,
• Low interest rates making business ownership a more attractive investment.
ABC has experienced a 24% drop in new business listings for the 12 months to March 2021.
In total, we have had 716 new businesses listed for sale for the 12 months to March 2021 vs 938 new listings for the corresponding period last year.
The lower North Island region (40%) and the South Island region (24%) have experienced the biggest declines. Both of these regions have historically had a high concentration of hospitality and tourism businesses which contributes to the reduction in business for sale.
ABC Business Sales' volumes for 12 months to March 2021 are up 2%. This is the result of a very strong market where the majority of businesses listed for sale are being sold. The last six months of confirmed sales are 36% up (235 vs 172) for the same period last year, with many businesses being sold at above asking price and getting offers within the first 10 days of the marketing campaign.
For the 12 months to March 2021, ABC sold 380 businesses vs 371 for the same period last year.
This is great validation that now is an excellent time to review your options if you’re in business.
Always happy to chat. Cheers for now Lester and Richard.
