"It's a buyer's market for businesses."

“It’s a buyer’s market for businesses.” Inc. Magazine, June 2009

We’ve been talking about counter-cyclical thinking and counter-cyclical businesses for some time. These are individuals and business types that react in an opposite direction to “herd mentality” individuals, and respond to downturns in economic trends with positive business gains. It’s extremely rare to find these types of people, and rarer still to identify businesses that thrive in poor economic climates like we have today – tight credit, increasing unemployment, decreasing discretionary income, and concerns about the economic future. Yet if we carefully look, there are treasures to be found in business opportunity!

Inc. Magazine notes that for those seeking to acquire a business, median sale prices are FALLING significantly, nearly 27% in 2008 as compared to 2007. In fact the median sales price in 2008 fell to $400,000 from $551,000 in 2007. For sellers of businesses, that’s truly bad news, and the fruit of growth with expected equity is eroded. For entrepreneurs and buyers, it is fantastic news PROVIDED they have strong capitalization and ready credit availability. Unfortunately, this is exactly where the difficulty even in a “buyer’s market” comes in - credit availability and capitalization.

The answer is to find a business that takes advantage of counter-cyclical tendencies with respect to general economic trends, has a relatively low capitalization cost, and that has adequate financing opportunities that make it viable. Right now business brokers are reporting cash deals are yielding a 10-15% discount. But rarely is it possible (or even advisable in most cases) to buy a business strictly for cash, and in these days of tightening credit, seller financing has become critical. Business sellers who offer attractive financing are realizing faster sales, and smart buyers are taking advantage of the “buyer’s market” of choices and lower prices.

Even franchising, that super-star of business growth that has routinely boasted growth rates of 5-7% year over year, has seen a slow-down in expansion to a mere 2.1% in 2008 as compared to 2007. Not surprisingly the wise business entrepreneur has realized that franchises have significant advantages that take advantage of the “buyer’s market” of business elements, but have the proven system of operation and strong training programs that give a greater success potential when compared with traditional acquisitions and start-ups.

At Access Education we are proud to offer franchising opportunities that take advantage of this favorable business market, have proven operations successes, are counter-cyclical to negative economic trends, and have attractive financing options. We invite you to visit our website at www.AccessEducationInc.com for more information.