If you are a business that relies on overseas suppliers for stock, you have probably been very frustrated with supply issues over the last 12 – 18 months. Most businesses have been impacted and as a result are holding extraordinarily high stock levels in an effort to ensure they can keep supply up to customers. I am commonly seeing significantly high stock values in financials when appraising businesses for sale.
If you are a searching to buy a business in the current economic environment, you will need to accept that stock values for most businesses are not normal at present when compared to pre COVID times.
There are ways to negotiate these excessive stock levels when the business sells that most buyers and sellers find acceptable. If you want to discuss how to navigate this issue when selling a business, give me a call on 0432 455 183.