Would You Pay $899,000 To Buy This Business? Forbes Article

by a searcher from University of Southern California

3 years ago

I found this article this morning, and thought it would be helpful to other searchers:

https://www.forbes.com/sites/joshpatrick/2015/05/28/would-you-buy-this-business/#23877af215e2

4 likes
387 views
34 comments

searcher from University of Pennsylvania - The Wharton School

Great discussion in the comments. A point I would add is for businesses like this one, they are more valuable to the person operating it and getting the high salary than they are to a buyer. Often the person operating it is not in a position financially to forego the salary each year... and the valuation at best is going to provide maybe 2, maybe 3 years worth of that salary (but after taxes, it isn't even that good)... which tends to make the deal unattractive. I don't think brokers are the culprit (sometimes they are ;-)), I think it is structural for businesses of this size. Monthly payments (even if you have to work for it) is better for a lot of people than a small lump sum - especially if their other employment options are limited.

3 years ago | like reply | 0 likes

searcher from Carnegie Mellon University

interesting perspective. thanks for sharing.

3 years ago | like reply | 0 likes

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