As the pandemic weakens its footprint, the U.S. economy is already showing signs of recovery.  People are becoming vaccinated, restrictions are being lifted, and consumer spending is surging as an increasing number of businesses are re-opening and welcome Spring shoppers.

Over the past year, many owners have been focused on keeping their business afloat and navigating public health orders, rather than planning their exit strategy. Now that that things are turning around, should you start looking for a buyer? Well, that depending on a few factors.

Here are 3 things you should consider before deciding to sell (or not sell) your business in 2021:

  1. Buyers Demand Has Been Strong and Is Expected to Continue. Since Q2 2020, buyers have been actively seeking opportunities. In fact, site traffic has been exceeding pre-pandemic levels, as buyers flock to high performing, pandemic-resistant businesses levels. According to BizBuySell's Insight Report, the median revenue and cash flow of businesses sold in Q1 '21 were both up 15% and 7%, respectively. As a result, buyers have been paying premium prices for these businesses, with the median selling price up 30% year-over-year. If your business has been over-performing during the pandemic, now may be your change to get out on top. If your business has been struggling, it may be better to recover value first.
  2. Buyers Are Shifting Focus to Battle-Tested Pandemic Survivors. While high performing businesses have been the hot commodity to date, many buyers are not interested in paying the associated premium. According to an April BizBuySell survey, most buyers (54%) say they are looking for businesses only maintaining pre-pandemic performance and 52% would even prefer the discount associated with an impacted business versus seeking one exceeding pre-pandemic levels (37%). Depending on where you fit in this range, you may have some flexibility to extend or expedite your exit.
  3. Business for Sale Inventory is Expected to Grow and Diversify. While demand has been high during the pandemic, supply has been limited due to many depressed businesses waiting on the sidelines.  As more businesses re-open and benefit from pent up consumer demand, more owners will regain value and enter the market. This is especially true for Baby Boomers who make up a large majority of business owners preparing to retire and exit their businesses.  If you are ready to sell now and can receive a suitable price, it may be best to enter the market before competition increases.

While things are looking brighter in 2021, there are many market variables to consider when selling a business. In addition, you need to have a good sense of your business value and a plan for what you will do after you exit.  As every market is different, as is every business, your best move is to contact a professional business broker who can advise you based on your unique circumstances.  You don't have to sell your business, but you will feel better knowing if you could.