You want to sell your fruit growing business? Then it's good to know what the takeover market in the field of fruit growing businesses looks like.
The number of mergers and acquisitions in the fruit growing sector is very low. On average, the market is stable, so there are few changes in ownership. Nevertheless, there has been an increase in the number of acquisitions, specifically in the last few years.
There are many ways to value a business. A commonly used method is to express the valuation of a business in 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 - to which a fruit-growing company belongs - 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 fruit growing sector is supply-driven market, with strong competition between them. But the competitive position of the Dutch fruit-growing sector is also under pressure, Rabobank stresses. Various initiatives are currently being explored to strengthen the fruit-growing sector, including by advocacy group Nederlandse Fruitteelt Organisatie (NFO).
Expressed in figures, the number of fruit growing 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 also offer fruit growing companies many growth and perhaps acquisition opportunities:
The average fruit growing income will rise to 51,000 euros per unpaid annual work unit in 2020, is the expectation of the Wageningen Economic Research (WER). It is a sharp increase from 2019 and 2018, when income remained at 36,000 and 30,000 euros per annual labor unit.
The demand for soft fruit has increased sharply in recent years, according to Rabobank. Blueberries in particular are more popular because they are easy to consume and we see a trend of increasing health awareness. More and more studies confirm that healthy eating prevents obesity and type 2 diabetes. Especially fresh, unprocessed fruits contribute to a healthy lifestyle.
The European market is saturated in terms of sales volume and competitive pressure is high. This offers opportunities to add value, develop new revenue models and further (chain) cooperation and digitalization. Innovations such as robotization, automation and digitalization will play a role in the fruit growing sector in the coming years. LED lighting may also offer a solution in fruit growing in the coming years, in order to circumvent rising energy prices, according to Rabobank.
