Recession Offers Small Business Opportunities in Second Quarter

For the second quarter of 2011 it looks like Main Street and Wall Street will present two very different pictures. While large publicly traded companies are expected to report strong profits, small businesses across the country are still dealing with tight credit, nervous customers and increased costs.

“We still see many small and midsized business owners not obtaining sufficient loans and being very disgruntled with the banks”, says Achim Neumann, President of A Neumann & Associates in New Jersey. ”This is a significant challenge given that small businesses account for more than half of private-sector employment and gross domestic product”

Economic uncertainty and inflationary pressures have resulted in delayed hiring and capital expenditures. Often there are no plans to expand staff  within the foreseeable future, according to a recent U.S. Bancorp survey of  over 1,000 companies in the U.S.. All have with annual revenue of $10 million or less.

Despite 50% of the companies expecting more revenue in a year, 78% believe the U.S. economy remains  in a recession, and many expect it to stay there into 2012.  In May, the optimism index of the National Federation of Independent Business declined. This is now the third month in a row that this has been the case.

One outcome of this environment continues to be a smaller number of businesses being available for sale. “Whereas in the past we have had consistently 1,000 businesses for sale and 1,000 buyers interested in an acquisition in our network, the numbers have changed to 300 businesses for sale, with 1,000 buyers remaining,” says Neumann.  Consequently, any seller contemplating a sale of his business is in an excellent position to obtain the full Fair Market Value for his operations.

And with activities having started to pick up in the second quarter on the sell side, now might be the best time for a business owner to get started. “There has not been any time in the past ten years where buyer inquiries have so significantly outnumbered businesses available for sale,” says Neumann,  “and with a team of thousand professionals in the field we are very well positioned to support business owners in obtaining their goals.”

Achim Neumann is president of
A.Neumann & Associates, LLC
Atlantic Highlands,
an affiliate of BBN, Dallas, Texas, with 450 offices nationwide.

Visit the firm at www.neumannassociates.com
or call 732-872-6777