Bizstats Quarterly Report: Q3 2024
We are thrilled to introduce our very first quarterly report, bringing you key insights from Q3 2024 on small and medium business sales in New Zealand. This report marks a significant milestone for Bizstats, and we are eager to share the trends shaping the business sales landscape.
Steady sales volume
In Q3 2024, we saw 116 business sales — a figure that closely aligns with the same period in 2023. Year-to-date sales volumes have now exceeded pre-pandemic levels, providing a positive signal for the market as we head into Q4, which traditionally sees a further boost in activity.
This uplift in sales volume indicates broader positive trends such as increased buyer confidence and overall economic recovery.
Mixed sales price trends
The mean sales price experienced a dip this quarter, dropping to $474k, largely due to fewer deals exceeding the $1 million mark. However, the median sales price tells a slightly different story, showing a quarter-over-quarter increase from $245k to $260k.
Overall, prices are trending positively compared to 2023, signaling a slow but steady recovery.
Key takeaway: Despite a dip in mean price, the rising median suggests steady improvement in the core mid-market where most SME transactions occur.
Uptick in SDE multiples
For the first time in over three years, we have observed an uptick in the average Seller's Discretionary Earnings (SDE) multiple, which has risen to 2.20x from 2.11x in the previous quarter. This ends a long period of decline that began in Q4 2020.
While there's still ground to recover, this increase could represent the beginning of a positive trend in business valuations. To see how this trend continued, check out our Q4 2024 quarterly report.
Key takeaway: The first SDE multiple increase in three years may signal the start of a valuation recovery for New Zealand SMEs.
Intangible value's growing role
Intangible assets continue to make up a significant portion of business sales prices. Currently, intangibles account for approximately 63% of the total sales price — a dramatic increase from 38% in 2000.
This trend reflects ongoing changes in what drives value in today's business environment, particularly with the rise of:
- Brand value: Established reputation and market positioning
- Customer bases: Recurring revenue and loyal client relationships
- Intellectual property: Proprietary systems, processes, and know-how
Final thoughts
These highlights reflect clear improvement in the New Zealand business sales market. For more detailed insights, including comprehensive charts and deeper analysis, we invite you to download our full Q3 2024 report.
We hope you find these insights valuable as you navigate your business decisions, and we're excited to keep bringing you quarterly updates. To search our database of NZ SME transactions, visit Bizstats.