Morgan Business Sales, one of the biggest business brokerage firms in Australia, in an exclusive interview with Eleven Media confirmed that despite the impact of rising interest rates increasing at record levels it is yet to impact the SMB acquisition market.
Morgan Business Sales are Australia’s leading Specialist Business Brokers. For the past 25 years, they have successfully sold hundreds of large and small businesses. The sharp
Dru Morgan, the Director of Morgan Business Sales said this when interviewed by Eleven media, “The strong buyer interest we are experiencing we believe has a lot to do with increased savings purchasers have accumulated during the pandemic period and the increase in popularity in more creative financing options like vendor finance.”
Eleven Media’s research showed that one of the biggest hurdles in business acquisitions is financing. Historically it has been unusual for an individual or a company to have the level of funds required to buy a quality operation. Like any market where there is this shortfall, they then turn to banks to make up the difference. However, when interest rates rise like they have been, it reduces borrowing capacity. Data shows that when this has happened in the past, it has been clear to see buyer enquiries taper off with the hikes. But something is different this time as demand is still increasing.
Dru Morgan said, “People and companies who bunkered down during the pandemic have capital ready to invest. No financing required, so, no impact from rising interest rates. There are now deals being done using vendor finance. This is common in the US market but has only recently started to increase in popularity in Australia. Buyers making a repayment agreement directly with the previous owner are protecting themselves from interest rate rise risk.” He remained bullish that the buyer enquiry levels would remain strong because of these two factors.
In the current economy, media confirm that the majority of investment avenues are performing poorly. But the potential returns from buying a quality business remain strong.
About Morgan Business Sales
Morgan Business Sales are Australia’s leading Specialist Business Brokers. For the past 25 years, they have successfully sold hundreds of large and small businesses. Whether looking to buy or sell, they are ready to assist you.
From Business Valuations, Franchise sales, to corporate sales, and large business sales to the very smallest business sale, their experienced team of Specialist Business Brokers are ready to achieve a great result for you. Learn more about Morgan Business Sales via their website here: www.morganbusinesssales.com
