2014 was a banner year for the mergers and acquisitions market in West Michigan. Sellers have had time to recover from the Great Recession and buyers have capital available and the capacity to take on debt. So the question becomes what will the market do in 2015?
There a ton of articles out there that go into interest rates, LP's and other M&A lingo that means very little to the common business owner. In fact many business owners will probably skip right by this post because they don't care what is going on in the world of buying and selling businesses because they feel that does not impact their business. But every business owner should be taking a big picture view every once in awhile and the increase in competition will impact many businesses in 2015.
Buyers are still in the market to buy. There is more than enough information out there that would suggest that 2015 will have the same ideal conditions as 2014 for those in the market to buy businesses. Many business owners that have sold their business in the last year or so have cash on hand, have experience on how to grow a business and are looking to do some of their own investing. West Michigan is also drawing the attention of people and firms from outside the area. This outside interest will only continue to grow as the year progresses.
Basically in short, Grand Rapids and West Michigan is teaming with sharks looking for something to eat. These sharks are in the business of buying and investing in private businesses. The competition among these individuals and groups is only going to increase as they bump into one another. Could your business be the prey these buyers and investors are looking to get a hold of?
On the other end of things, many small business and medium size business owners are growing older, their businesses are generally going pretty well and that gives these owners the energy to keep pushing forward. The wave of Baby Boomer business owners retiring might not hit the market in 2015 but the number of sellers will likely increase. Not only are some of those 50 year old business owners going to retire but some are going to see a prime opportunity to exit their business because of the competition among buyers. Sellers looking to really take advantage of the demand for businesses are going to face competition in making their business look the most appetizing in order to get the most value out of their business. And what if the flood walls do break and the Baby Boomers do start to sell their businesses like crazy?
There is another aspect of competition that might start to be revealed in 2015 and that is the increase in competition with your business. You might not even know that one of your competitors has been acquired or merged with another business. Those buyers and investors are generally not buying Michigan businesses to hold the status quo. They want to grow their investment and that means more competition with your business. And those buyers and investors have capital to push that competition to a level you might not be prepared for. If you are not selling, you are going to want to keep pushing to stay as far ahead of the competition as you can in 2015 because one of those competitors might be getting a big push and you want to be ready for that.
2015 should be another fun year for West Michigan businesses. Small businesses need to keep up with big picture trends because their is going to be lots of opportunity and potential issues that will come up over the next 12 months. It can sometimes be tough to believe that you need to take your focus away from operations and cash flow but that can be the difference between missing a big opportunity and just getting by.
For more information on how you can grow your Michigan business' value in 2015 and more, contact The Business Law Group today and set up a free consultation.
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