Up and Coming Weekly is a weekly publication in Fayetteville, NC and Fort Bragg, NC area offering local news, views, arts, entertainment and community event and business information.
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WWW.UPANDCOMINGWEEKLY.COM JUNE 14 - 20, 2023 UCW 17 Selling your business is a big deci- sion. Equally important is finding the right business advisor to help navigate the process. Results from the latest Market Report show that choosing a broker form a firm like Transworld can help you meet your business goals. Let's dive into Transworld's small business transaction activity for 2022 and learn more about what sets Transworld's business advisors apart. Another historic year It's been two years of historic performance levels for Transworld. Not only was 2021 record-setting with 31% more deals closed versus 2020, but 2022 surpassed it by 62%. e total deal value of businesses increased, too, by more than 25%. e 2022 monthly breakdown of sold deals topped every month in 2021, with 10 of the 12 months showing double-digit increases. In all, a host of key metrics were up, from the average deal value (27% YOY increase) to the number of sales listings (up 24% YOY), from the median deal value (43% above 2021) to the average listing price (a 23% increase YOY). Who's selling? And for how much? e impact of the pandemic's early lock down phase was significant, and the recovery from 2020 contin- ues. One insight the market report revealed was that the primary driver of business sales is baby boomers. is demographic is preparing for their next stage in life and looking to either shed responsibilities or fund their next entrepreneurial endeavor. Another factor fueling the impres- sive 2022 performance is the number of buyers paying record prices for well-performing businesses. Compa- nies that did well and thrived during the turbulence of the pandemic are especially appealing. Buyer motiva- tion was evident in the decrease in days on the market by 6%, with 2022 also showing an increase in cash deals. Also of note was an increase in owner financing through banks, even with the rise in interest rates back to normal levels from the extraordinary lows experienced in previous years. e report found the top five most active business segments were res- taurants, construction, beauty/per- sonal care, automotive and medical- related businesses, both by closed transactions and deal volume. Interested in selling? If all this information leads you to think the time might be right for you to sell your busi- ness, what are the most perti- nent questions you should ask a business advisor? First, you can ask how to prepare your business for sale properly. Business advisors can help you get all your busi- ness's legal or financial records in order and recommend any additional experts, such as ac- countants or lawyers, you may need. Next, ask your business broker how they will find the right buyer for your business. ey will help you package and market your business through- out the world to find the best buyer. An experienced advisor will help you handle these details and more, all while working to keep the sale confidential and doing all they can to get the best price. Consider how inflation and inter- est rates will affect your options. Even with the recent interest rate increase by the Fed, the rates are returning to a normal level, and the market continues to remain strong. What's more, regardless of the inter- est rates, people are still selling and buying at historic numbers. If you think selling is on the horizon for your business, consider working with a business advisor. ey can help guide you through the process from start to finish. Editor's note: Ashley Kelsey is a Business Broker at Transworld Busi- ness Advisors of Eastern North Caro- lina. She can be reached at 910-302- 6447 or email akelsey@tworld.com. Local brokers can help guide your business sale by ASHLEY KELSEY BUSINESS & FINANCE ASHLEY KELSEY, Transworld Business Advisors of Eastern North Carolina. Comments? Akelsey@ tworld.com Steps to take before applying for a mortgage a STAFF REPORT A home is the single biggest pur- chase most people will ever make. at has perhaps become even more true in recent years, when the cost of homes has increased dramatically. e sticker price of a home may come as a shock to first-time buyers, but few homeowners purchase their homes in cash. Mortgages are a vital component of home ownership for the vast majority of buyers. Mortgages are loans obtained through the conveyance of property as security. When homeowners pay off their mortgages, the title of the property officially transfers to them from their lenders. ough most homeowners utilize mortgages to buy their homes, that does not mean the process is the same for everyone. A host of factors affect mortgage terms, and there's much prospective homeowners can do to secure the best agreement possible. •Recognize why a low interest rate is important. Mortgage interest rates have drawn considerable attention in recent years, as rising inflation has led to rates that have reached their highest point in more than a decade. Even a seemingly small difference in interest rates can save or cost homeowners thousands of dollars, if not tens of thousands, over the course of a loan. For example, the financial experts at Bankrate.com note that the dif- ference between a 5.5% interest rate and a 6% interest rate on a $200,000 mortgage is roughly $64 per month. at might not seem like a lot, but over the course of a 30 year mortgage the borrower who gets the 6% loan will pay in excess of $23,000 more in interest than the borrower who secures the 5.5% loan. Recognition of the benefits of securing the lowest interest rate pos- sible can motivate prospective buy- ers to do everything in their power to get a low rate. •Work on your credit score. So how can borrowers get the best possible rate? One way to go about it is to improve credit scores. Average mortgage interest rates vary significantly by credit score, with higher scores earn- ing borrowers significantly lower rates. According to data from FICO, as of mid-February 2023, borrowers with a FICO score of 760+ earned an average interest rate of 6.06%, while those with scores between 620-639 secured an average rate of 7.65%. By bolstering their credit scores before applying for a mortgage, prospective homeowners can improve their standing in the eyes of mort- gage lenders, which can potentially save them tens of thousands of dol- lars over the life of the loan. •Identify how much you want to spend. Prospective home buyers may be approved to borrow much more money than they think they will qualify for. at's because lenders do not consider factors like utilities, in- surance, day care, or other expenses everyone has. at means it's up to borrowers to determine how much those expenses will be, and how much they should be spending on a home. ough it might be tempting to borrow up to the amount lenders approve you for, in general it's best to stay below that amount so you can capably meet all of your additional obligations. Mortgages enable millions of people to buy homes each year. Some simple steps before applying for a mortgage can help prospective homeowners secure the best terms. A host of factors affect mortgage terms, and there's much pro- spective homeowners can do to secure the best terms possible.