Small business acquisitions leveled off in 2023 as interest rates climbed, but 2024 looks better

NEW YORK – Is it a great time to promote your small business — or possibly purchase one?

Small business acquisitions have been up and down in 2023, reflecting the rise in interest rates that threw a kick back into the marketplace.

But a powerful fourth quarter, helped via a sign from the Federal Reserve that it used to be achieved elevating interest rates, may bode neatly for 2024.

Overall, the choice of small business acquisitions used to be in large part unchanged in 2023, in step with business market BizBuySell’s Insight Data, which tracks and analyzes U.S. business-for-sale transactions.

A complete of 9,093 companies have been reported offered on BizBuySell in 2023, up not up to 1% from the 9,054 companies offered in 2022. The price of the offers rose to $6.5 billion from $6.3 billion. Quarterly effects display stark adjustments in the marketplace: Transactions fell 10% in the primary quarter, remained flat in the second one and 3rd quarters as interest charge hikes slowed, and rose 12% in the fourth quarter, amid news of cooling inflation and attainable charge cuts.

So it may well be a great time to shop for — as lengthy as the business turns out forged.

“If the business has a good return on the investment and ability to service debt, it’s likely a good time to buy, regardless of rates,” said Ken Bohenek, business intermediary at Murphy Business Sales in Northern Idaho. “Then, as rates soften, you’ll likely be in a much better cash flow position than those who bought when money was cheap, and rates quickly escalated.”