3 Things You Should Know About Small Business: July 10
NEW YORK (TheStreet) -- What's happening in small business today?
1. Business-for-sale transactions dip in second quarter. According to BizBuySell.com, the number of businesses sold in the second quarter fell 1.6% as compared to the second quarter in 2011, but the number of transactions for the year remains above 2011 numbers, "suggesting that the business transaction marketplace still has sufficient momentum for modest recovery in 2012."
The results were included in BizBuySell's Second Quarter 2012 Insight Report, which aggregates business-for-sale transactions reported by participating business brokers nationwide.
According to BizBuySell's data, 1,603 closed transactions were recorded in the second quarter; 3,332 businesses were sold in the first half of 2012, 1.2% above the first two quarters of 2011.
"While we don't like to see a drop in reported small business transactions, our analysis suggests that this quarter's decline is a small hiccup in an otherwise consistent path to recovery," says Mike Handelsman, group general manager of BizBuySell.com and BizQuest.com. "Based on what we have heard from brokers, as well as our own experience, we are expecting a strong second half for 2012 that will continue the slow but steady improvement we've seen since small business sales activity began to strengthen in mid-2009."
2. Small-business owner optimism fell to its lowest in eight months. The latest monthly optimism index from the National Federation of Independent Business showed that the June index dropped three points to 91.4 -- its lowest level since October and bad news for the small business sector, according to the association.
Of the 10 components the index measures, only the expectations for credit conditions improved. Labor market indicators and spending plans for capital equipment and inventories accounted for approximately 40% of the decline, NFIB says. Small businesses also had a reversal in earnings trends, which contributed 21% of the index's decline. Owners' expectations for business conditions and real sales gains contributed the other 40% of the index's decline.
Political uncertainty among business owners also remains historically high. It continues to be a primary reason why small-business owners have concerns about expanding.