It looks like an economic downturn is heading our way due to the COVID-19 pandemic. While this has implications on our finances, the economy and the job market, some individuals aren’t slowing down their business plans.
In fact, a recent survey from BusinessesForSale.com found that while interest has died down, hundreds of thousands of people are still researching businesses to buy.
The website claims that traffic halved from 1.3m visitors to 700,000 in March. It’s a big drop, but that’s still a huge number of people researching new business opportunities.
After running a survey on members, BusinessesForSale found that business buyers have both the cash and the optimism to purchase a new business.
- 54% of business buyers in the UK have at least £50,000 in cash to use as a deposit.
- 34% even plan to use their cash reserves to fund the entire business purchase – without the need for additional finance.
- 80% of business buyers are also expecting prices to lower during the recession.
With businesses eager to sell for various reasons, this could benefit those looking for new ventures. So, it looks like there could be a mini business boom in certain sectors which suggests good news ahead.
Why are people looking to buy businesses now?
With so much uncertainty, it’s not immediately clear cut why people are eager to buy new businesses now.
Andrew Markou, CEO of BusinessesForSale.com said that business buyers have been wary over the past few years. However, he suggested that the pandemic has kickstarted a few hesitant buyers into action. This can only be good news for the economy and business sellers who are worried they’ll struggle to sell right now.
Are you thinking of buying a business soon?
Buying a business is always a bit of a risk and there’s never a perfect time to do it.
If you are planning to buy a new business during a recession, then you may need to dig a little deeper to find funding and support right now.
This might impact your business plan. You may need to include sections on how you plan to deal with the pandemic and recession. It’s a good idea to outline your plans and strategies and also analyse the business’ current performance in the market. This is particularly important if you’re applying for finance as lending may start to slow down.
With low prices for businesses and low interest rates this could, in some ways, be the best time to invest in a business. However, thorough research and planning are still key to success!
Do you think now is a good time to buy a business? Have you ever bought a business during a recession before? Let us know your thoughts in the comments below.