Businesses sold in San Francisco area down by almost half since 2007

The economic downturn is impacting the number of businesses bought and sold, especially in the San Francisco Bay area, and business owners are increasingly considering a lower selling price.

The number of small businesses sold per year in Sonoma County has dropped by almost half in the last three years, according to the Santa Rosa Press Democrat.

The value of businesses sold have declined also, with one Bay Area realtor reporting a 30 percent drop in revenue.

"The No. 1 reason small businesses don’t sell is that they’re overpriced," Peter Siegel, a business consultant, told the paper. He advises business owners who are trying to sell to consider financing part of the sales price.

Some business brokers also believe that owner financing can help move a business through escrow. It demonstrates to a bank that the previous owner – with all the experience – has an interest in seeing the new owners achieve success.

The market may be improving: Second quarter numbers from 2010 show a 6 percent increase in business sales.

But the process can still be tedious since most potential buyers don’t actually end up buying a business. Using business brokers can help identify the serious investors, writes author Russell Brown at BusinessBookPress.com.