Business buying intensifies; 40% of buyers are corporate refugees amid slowing job market
Transactions grow 8% year-over-year, driven by surge in Service and Retail sectors
Median sale price decline 2%, reflecting weaker financial performance
Uncertainty around 2026 outlook influences buyer and seller timelines
Business-for-sale transaction volume accelerated in the third quarter of 2025, with closed deals reaching 2,599, an 8% increase from Q3 2024 and up 11% compared to Q2 2025. This is according to BizBuySell, which tracks and analyzes U.S. business-for-sale transactions and sentiment from business owners, buyers, and brokers. The total enterprise value of completed deals hit $2.13 billion, marking gains of 5% year-over-year and 12% quarter-over-quarter.
Despite the uptick in activity, underlying concerns about the future appear to be weighing on business owners specifically. BizBuySell’s annual Buyer-Seller Confidence Index, which measures sentiment on a scale of 0–100, shows owner confidence declined from 50 to 48, falling below the neutral threshold.
This shift is closely tied to small businesses struggling with higher costs stemming from persistent inflation and ongoing tariff uncertainty. Over half (53%) of small business owners surveyed by BizBuySell say tariffs have increased business expenses, while 62% report that inflation is not easing, keeping prices for goods and supplies elevated.
Donny Ravas, owner of LogistEx Global Management, Inc. dba Dell Transport in West Virginia, explains “Things are expensive, especially insurance and maintenance costs. We’re a small company, so it’s tough. We've been around for 27 years in January 2026 and have seen just about everything. Fuel has come down, though.”
Strong transaction growth suggests many owners are choosing to sell now rather than wait. In fact, 55% believe they can achieve their desired price today, while 60% of surveyed business owners worry that waiting until next year could result in receiving the same or even a lower price.
“The market is strong. Sellers are surfacing and moving toward realistic expectations,” said Matt Valantine of Valantine Ventures, a business brokerage in Ohio.
While more owners appear open to selling, businesses are showing weaker financials and sale prices declined in the third quarter. The median sale price fell 2% year-over-year and 9% quarter-over-quarter to $320,044. Median cash flow dropped 2% YoY and 6% QoQ, while median revenue slipped 2% YoY and 6% QoQ to $674,500. These declines reflect the impact of rising costs and margin compression, rather than increased buyer leverage.
Deals also moved faster, with businesses spending a median of 149 days on the market, the fastest pace since 2017. This compares to 176 days in the previous quarter and 164 days a year ago. This faster pace underscores growing buyer interest and urgency to act on strong opportunities rather than attempting to time the market.
Buyer confidence remains positive, though it dipped slightly from 54 to 52. This modest decline is largely attributed to expectations of better opportunities emerging in 2026, according to the Buyer-Seller Confidence Index. Seventy-seven percent (77%) of buyers are confident they can purchase a business at an acceptable price in today’s market, and 78% believe they can secure the same or a better deal next year.
“There are many more buyers than there are sellers. Sellers who have a good cash flow business in a desirable industry are typically choosing from multiple LOI's,” said Joe Braier of Lake Country Advisors.
At the same time, the job market is slowing down, presenting fewer opportunities for white-collar and middle-management professionals. Thus, business ownership has become increasingly attractive. Currently, 40% of business buyers identify as “corporate refugees,” with 55% between the ages of 40 and 59.
“Many high-tech professionals are being laid off from their jobs, leading them to seek opportunities in small businesses,” said David A Smith of The Agency NW RE in Washington.
Artificial Intelligence (AI) is becoming increasingly popular among small businesses as they seek to cut costs, improve efficiency and remain competitive. Most business owners (55%) report using AI today. Among the most common applications are marketing (69%), analytics (56%) and customer service (39%).
Business owners are already experiencing a positive impact. An impressive 76% say AI has improved performance. This high percentage underscores the perceived value and effectiveness of AI enhancing business outcomes, whether through better targeting or increased efficiency. Of note, 13% of surveyed business owners have reduced the number of employee roles since adopting AI; 5% have added new roles. These figures are likely to evolve as the technology matures and becomes more accessible.
Buyer interest in essential industries surged in the third quarter, with service and retail sectors leading the way. Amid economic uncertainty, these categories stood out as resilient and attractive opportunities. Transaction volume for service businesses rose 11% year-over-year, while retail acquisitions jumped 14%.
“I focus on residential and commercial services. The market is still hot for HVAC, P&H, Electrical, Roofing, Landscaping, etc. and I have 300+ active buyers in my database. There are not enough listings for all the buyers,” said Adam Pratt of Atlantic Business Brokers in Maine.
Following broader Q3 trends, acquisitions in both sectors leaned toward lower-priced deals tied to modest earnings. The median sale price of service businesses fell 8% YoY to $300,000, with median cash flow down 15%. Retail followed suit, with a median sale price of $237,000 —down 5% YoY —alongside a 4% YoY decline in cash flow.
“Market conditions depend on the sector. Essential service businesses favor sellers, while discretionary and lifestyle businesses tend to favor buyers,” said Aniss Cherkaoui of Transworld Business Advisors in Fort Lauderdale.
Restaurants had a moderately strong quarter, with closed deals up 2% year-over-year and 27% quarter-over-quarter. Despite a 1% dip in median sale price to $220,000, restaurant businesses saw a 4% YoY increase in median cash flow and 8% rise in median revenue. This resilience is notable given the backdrop of persistent inflation and tariffs, which continue to elevate operating costs across all sectors.
While the restaurant industry is particularly sensitive to discretionary spending, many operators are adapting. As consumer habits evolve, successful restaurants are often those refining menus, streamlining operations, or focusing on staple offerings better positioned to drive sales and maintain profitability.
In contrast, the manufacturing sector faced significant headwinds. Transactions fell 11% year-over-year, and the median sale price dropped 37% to $550,000. Ongoing trade uncertainty, supply chain disruptions, and rising costs have contributed to lower valuations and fewer completed deals. Financial performance also declined, with median cash flow down 28% YoY and median revenue down 27%.
Importantly, the slowdown in manufacturing transactions may reflect delayed deal closures rather than diminished interest, as ongoing tariff fluctuations and trade policy uncertainty prompt buyers and sellers to reassess.
“Tariffs are affecting manufacturing and retail deals. There is a lot of variability in costs, which are fluctuating, so deals may slow down, but they are still progressing,” said AJ Ramsey of Transworld Business Advisors - Eastern NC.
Rising demand and transaction volume amid a volatile economic environment —including constantly shifting trade policy, government shutdowns, and persistent inflation —highlight the resilience of today’s entrepreneurs. While macroeconomic factors do have an impact, small business acquisitions are driven more by financial and personal readiness.
This is especially true for owners, where retirement remains the main motivation for an exit, as indicated by 42% of sellers surveyed.
“Sell when you, your family, and your company are ready. Don't let the economic factors stand in your way. In the end, it won't make that much of a difference,” said Bill White of Murphy Business & Financial Corp. of Ohio.
Although the future state of the economy remains unclear, 2025’s performance indicates that the business-for-sale market is capable of adapting. Small business confidence suggests sellers will continue to adjust pricing and expectations, while buyers remain focused on value and, in the short term, lower risk opportunities.
Additionally, the Federal Reserve has projected two additional rate cuts this year, with at least one more expected in 2026. These reductions are anticipated to ease borrowing costs, a catalyst likely to impact deal activity.
“I hear a lot of noise on the economy as far as inflation and tariffs or other politically motivated topics, but when the rubber hits the road, I don't see these factoring into deals in most industries. High interest rates remain the most impactful economic barrier for deals,” said David A Smith of The Agency NW RE.
With a large wave of demand hitting the market, buyers are advised to stay grounded in their expectations.
“Be realistic. If you find a perfect business, get ready to compete with dozens of other buyers for it. If you find mediocre businesses, you might be the only one interested and you could get a decent business for a bargain price, then it is just up to you to make it into a better business,” said Rebecca Carr of West Shores Realty in California.
That realism is echoed by other experts who caution against common misconceptions about small business ownership.
“Too often, we see individuals with access to cash, or with large bank accounts, looking to buy a highly profitable, self-sustaining, absentee-owner business, and they use the word ‘investment’. They have the intention of working 0 hours on the business. You can't buy a small business as an investment. Owning a small business is not a passive method of income. A small business owner always works in the business. Whether it's 20 hours or 80 hours a week, the owner works on the business. Some buyers have no idea what owning a small business is actually like,” said Patrick Sheehy of Santa Rosa Business in California and Commercial.
Patrick McAdams of Murphy Business Sales in Wisconsin adds, “Talk to an SBA lender before you go buy a business. Also quit watching influencers on YouTube, Facebook, LinkedIn, etc. that are supposedly buying businesses for $0 down. That does not happen in the real world.”
For business owners on the brink of retirement, burnt-out, or simply considering a sale, the key remains preparation. Twenty percent (20%) of surveyed business owners admit to not being prepared to sell their business. The first step should be ensuring accounting records and tax returns support their desired price.
“If you are taking unreported cash, stop it now. Better yet, stop three years before you want to sell,” said Charlie MacPherson of Inbar Group, Inc. in Maine.
That preparation includes having clean financials and realistic expectations about the sale timeline and valuation.
"Understand that it typically takes 4 to 12 months to sell a business and that the value of any business is either the value of the tangible assets or a capitalization of earnings, whichever is greater. Have good financial records," said Jeff Jones of Advanced Business Brokers, Inc. in Texas.
Once the groundwork is laid, sellers should be ready to act.
“If you are ready to exit the business and you have a realistic valuation that makes sense, move now. Don’t wait for some ‘perfect time’.” Said Michael Weisbeck of Sunbelt of North Dakota.
The BizBuySell Insight Report is a nationally-recognized economic indicator that tracks the health of the U.S. small business economy. Each quarter, BizBuySell analyzes sales and listing prices of small businesses across the United States based on approximately 50,000 businesses for sale and those recently sold, reporting changes in closed transaction rates, valuation multiples and other economic indicators for the small business transaction market. Closed transactions are reported to BizBuySell.com on a voluntary basis by business brokers nationwide. Each report includes real small business data on over 70 major U.S. markets and across 65 small business industries.
BizBuySell is the largest business for sale marketplace online, receiving over a million visitors a month. Since 1996, BizBuySell has offered tools that make it easy for business owners and brokers to sell a business, and potential buyers to find the business of their dreams. The website also features an extensive franchise directory as well as an easy-to-use business valuation tool.
Adam Debussy
BizBuySell
Email: adebussy@bizbuysell.com
