Survey: Small Businesses Expect Struggle for Financing

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Survey: Small Businesses Expect Struggle for Financing

CAMBRIDGE, Mass. -- A majority of small business buyers and sellers said it will become harder to obtain acquisition financing over the next two quarters, according to a recent MergerNetwork survey of 1,304 members of its online marketplace.

The survey found 81 percent of respondents expect to have more difficultly obtaining financing to buy businesses over the next six months, while 72 percent said the current market is more favorable to buyers and 74 percent said they expect selling prices to fall, according to MergerNetwork.

"Almost everyone who is active in the businesses-for-sale market realizes that the government bailout is going to take some time to trickle down to businesses on Main Street," Robert Brauns, founder and president of MergerNetwork, said in a statement. "Buyers and sellers that have cash in hand, or that can come up with creative ways to structure deals, are going to come out on top in this environment.”

The survey was conducted Oct. 13, to 15, 2008. MergerNetwork sent survey invitations via e-mail to more than 45,000 of its members. Of the 1,304 respondents, 75 percent said they are actively looking to buy a business. Twenty percent are actively looking to sell a business. Nearly one-fourth act as intermediaries, such as business brokers, real estate brokers or investment bankers.