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Why Selling Your Business in the Next Decade May Prove Difficult

Selling companies is no trite task. It can skill at all points along the value chain including, industry analysis, company valuation and seller farming. Such pieces of the puzzle completely ignore and exclude issues relating to company drama and general market fluctuations, which both tend to vex private companies. Moreover, demographic shifts are coming in the next decade which could have an erosive effect on the values of middle-market businesses. Here are some of the value-bursting effects that may dampen corporate valuations and divestment in the coming decade.

Understanding the full import and potential issues of middle-market deals requires a bit of a dive into private company supply/demand economics. United States demographics are shifting rapidly. With over 25% of the population within the “boomer” segment, there are an estimated 7 to 8 million businesses that will need to be sold in the next 10 to 20 years. Using simple supply and demand, it is easy to see that such a boost in supply may create negative pressure on private business value when it comes time to sell.

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