How the market for businesses (buying and selling) has changed since 2008 is the subject of this follow-on conversation between Exit Motivation’s Simon Kidney and business adviser and broker Mark Oxenham, who first featured here a couple of weeks ago.

Selling businesses has changed since the financial crisis first hit in 2008, according to Mark; in his experience: “People have become far less cavalier over the years since the Lahman Brothers collapse triggered what we now call the credit crunch.” He continued: “In the intervening years, running a business has become fam more onerous, and much more research is undertaken both by sellers and buyers before deals are secured.”

In a historical context, the Covid pandemic hit just as the world’s economy was starting to pick up after the financial crisis. Simon was interested in Mark’s view on whether the experience of the last four years has prompted more business owners to sell up.

“There is more of a tendency to hold onto what they’ve got, developing strategies to navigate the long-tailed aftermath of the pandemic and look to sell in the future when things are looking up,” Mark commented. “And with 48k businesses currently estimated to be at risk of imminent collapse, not all are going to make it.”

Simon and Mark agree that there are some steps the government can take to help – keeping Entrepreneurs Tax Relief and reducing Corporation Tax to incentivise investments.

Mark concluded the conversation with what, in his experience, makes a company sellable, and it makes perfect sense: “Organisation and drive are key. A well-motivated seller, who understands and is comfortable with his motivation and commitment around the sale and likely financial outcome, is always more likely to succeed,” he explains. “Budgets, business plans, cashflow forecasts up to date and professionally prepared are the bedrock of a good sale.”

“An entrepreneur’s motivation underpins the whole business exit process,” agreed Simon. “Developing a deeper understanding of this – and how it drives commitment to the exit process – by building and bringing together academic research like mine and the practical application of business advice and brokerage can only advance commercial understanding and practise.”

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