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BusinessesForSale.com's latest survey seeks to find out what the best source of financing is to buy a business in Australia. Find out what over 50 business buyers say. LONDON, March 8, 2023 /PRNewswire/ -- With rising interest rates, bank reluctance to lend, and overall tightening on finances and household budgets, it's fair to assume that buying a business would be an insurmountable task right now. However, over 50 business buyers currently in the process of buying a business report differently in BusinessesForSale.com's latest survey. Australian business buyers are savvy, with most using a combination of sources to fund the business purchase. This includes releasing equity in their homes, using savings, using superannuation, the disposal of any surplus assets, and using more traditional methods such as bank loans as a last resort. Here is a deeper analysis from the survey: Cash is king With most participants buying or looking to buy a business between $100,000 - $1 million AUD, cash is the most popular form of finance. In an effort to minimise inflation, the Reserve Bank has recently implemented another increase in interest rates, so taking on debt through a loan is not buyers' first choice. Cash being the highest chosen form of finance is not surprising; this method offers multiple benefits, including financial flexibility, negotiation power and an ability to purchase other assets quickly. Home equity finance Home equity finance is the second most popular finance route that Australian buyers are pursuing. Some entrepreneurs are turning their home equity into cash, which often has lower interest rates and manageable repayment terms. However, we recommend that buyers do not rely solely on home equity to purchase a business, but rather a combination of different finance methods. Bank loans and vendor finance Bank loans are still considered an accessible form of finance, but it is not buyers' first choice. Buyers are also exploring alternative methods of finance with the seller, particularly vendor finance or earnout structures with a handful of buyers currently exploring this option. This could be a win-win situation as this option offers the seller some cash injection and ongoing income which might be more appealing to them than cashing in the whole asset. Other key insights from the survey include: Australian buyers are interested in the hospitality and retail sector. Despite these sectors being severely impacted by recent economic challenges, they have great opportunity to digitise and cater to shifting consumer demands. New South Wales, Victoria, and Queensland are the most sough-after states. More than half of the participants said they would choose another finance methods if they could, with vendor financing being the most ideal alternative. Participants said the hardest aspects of raising finance are rising interest rates, lender approval and the length of the process. Buyers' biggest concerns when purchasing a business are inaccurate valuations, undisclosed issues, and owner reliance. If you would like to understand more about the best sources of finance to buy a business, you can read our loans to buy a business guide. Other helpful information: BusinessesForSale.com is a global platform that partners with entrepreneurs and business owners looking to buy or sell a business anywhere in the world. BusinessesForSale.com is owned by Dynamis Ltd, a privately owned company based in London. The site sees over 1.2 million visitors every month, including 75,000 monthly enquiries.

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Australia , London , City Of , United Kingdom , Australian , , Dynamis Ltd , Reserve Bank , South Wales , Businessesforsale Com 39s Latest Survey Seeks To Find Out What The Best Source Of Financing Is Buya Business In Australia Over 50 Buyers Say London , March 8 , 023 Prnewswire With Rising Interest Rates , Ank Reluctance To Lend , Nd Overall Tightening On Finances And Household Budgets , T 39s Fair To Assume That Buyinga Business Would Be An Insurmountable Task Right Now However , Ver 50 Business Buyers Currently In The Process Of Buyinga Report Differently Businessesforsale Com 39s Latest Survey Australian Are Savvy , Ith Most Usinga Combination Of Sources To Fund The Business Purchase This Includes Releasing Equity In Their Homes , Using Savings , Sing Superannuation , He Disposal Of Any Surplus Assets , Nd Using More Traditional Methods Such As Bank Loans Asa Last Resort Here Isa Deeper Analysis From The Survey Cash Is King With Most Participants Buying Or Looking To Buya Business Between 100 , 000 1 Million Aud , Ash Is The Most Popular Form Of Finance In An Effort To Minimise Inflation , He Reserve Bank Has Recently Implemented Another Increase In Interest Rates , O Taking On Debt Througha Loan Is Not Buyers 39 First Choice Cash Being The Highest Chosen Form Of Finance Surprising This Method Offers Multiple Benefits , Ncluding Financial Flexibility , Egotiation Power And An Ability To Purchase Other Assets Quickly Home Equity Finance Is The Second Most Popular Route That Australian Buyers Are Pursuing Some Entrepreneurs Turning Their Into Cash , Hich Often Has Lower Interest Rates And Manageable Repayment Terms However , E Recommend That Buyers Do Not Rely Solely On Home Equity To Purchasea Business , Ut Rathera Combination Of Different Finance Methods Bank Loans And Vendor Are Still Considered An Accessible Form , Ut It Is Not Buyers 39 First Choice Are Also Exploring Alternative Methods Of Finance With The Seller , Articularly Vendor Finance Or Earnout Structures Witha Handful Of Buyers Currently Exploring This Option Could Bea Win Situation As Offers The Seller Some Cash Injection And Ongoing Income Which Might Be More Appealing To Them Than Cashing In Whole Asset Other Key Insights From Survey Include Australian Are Interested Hospitality Retail Sector Despite These Sectors Being Severely Impacted By Recent Economic Challenges , Hey Have Great Opportunity To Digitise And Cater Shifting Consumer Demands New South Wales , Victoria , Nd Queensland Are The Most Sough After States More Than Half Of Participants Said They Would Choose Another Finance Methods If Could , Ith Vendor Financing Being The Most Ideal Alternative Participants Said Hardest Aspects Of Raising Finance Are Rising Interest Rates , Ender Approval And The Length Of Process Buyers 39 Biggest Concerns When Purchasinga Business Are Inaccurate Valuations , Ndisclosed Issues , Nd Owner Reliance If You Would Like To Understand More About The Best Sources Of Finance Buya Business , Ou Can Read Our Loans To Buya Business Guide Other Helpful Information Businessesforsale Com Isa Global Platform That Partners With Entrepreneurs And Owners Looking Buy Or Sella Anywhere In The World Is Owned By Dynamis Ltd , A Privately Owned Company Based In London The Site Sees Over 1 2 Million Visitors Every Month , Ncluding 75 , 000 Monthly Enquiries ,

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