You want to sell your farm business? Then it's good to know what the takeover market in the field of agricultural businesses looks like. This sector is innovating, both in terms of technology and adapting to changing consumer needs.
Agriculture is a comprehensive term, which includes many businesses. Farm figures include all entrepreneurs who focus on farming and hunting or the services within this industry.
There are many ways to value a business. A common method of expressing the value of a business is "a factor x gross annual profit." This factor is also called multiple and another designation for gross annual profit is EBITDA (Earnings Before Interest Taxes Depreciation and Amortization).
In the agri and food sector, which includes a farm business, an indicative EBITDA multiple range of 5.4 to 6.1 is currently used, according to the Brookz Takeover Barometer. The average EBITDA multiple across all SME sectors is 4.90.
The valuation of a business is often the starting point for negotiations between buyer and seller. The outcome of these negotiations is the final sales price. So valuation and price are two different quantities. Besides valuation, the price is also determined by possible scarcity in the market, bargaining power of the parties, the strategic value of the business for the buyer and possible synergy effects for the buyer (cost savings, purchasing advantages).
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Do you want to buy a business or sell a business in the Agri & Food sector? With this Brookz Sector Monitor we want to present buyers and sellers with facts, figures and an outlook that provide insight into the number of transactions, the value development of businesses and the latest trends and developments in the Agri & Food. Because in every buying or selling process, thorough preparation gives peace of mind, overview and structure.
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The Netherlands is one of the world's top agricultural exporters and therefore agricultural companies abound. More than half are single-person farms.
In figures, the number of farms in 2024 looked as follows(CBS):
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A number of trends and developments will inevitably cause changes in the coming years, but they also offer farms many growth and acquisition opportunities:
Demand for organic products is on the rise. Animal ownership and animal husbandry without antibiotics to combat resistance: that's what it's largely about. Consumers want more scrutiny and preferably to prevent animal suffering. For many people in organic food an intermediate step before switching to all-vegetable, according to Rabobank.
Innovating in agriculture and arable farming: ABN Amro explains how. By working with automated systems and useful tools, such as drones, GPS and sensors.
Organic farmers are looking hard for side income as revenue is not always forthcoming. Farmers are under pressure and thanks to selling farm products from the region, they are increasing their revenue. Consider other offerings as well, such as a farm campground, farm golf and cow cuddling.
Consumers are living more consciously and, as a result, the demand for healthy food; food from the land is increasing. Through technology, consumers are increasing knowledge, as social media, eHealth and being constantly connected increases the possibilities. Big data is the connecting link, according to ING.
