Generally speaking, the Florida Keys business market is made of small businesses. Up and down the island chain, mom-and-pop establishments connect the business landscape the same way our mangroves anchor our islands.
But recently on both a local and national scale, there’s been a rebirth in the small-business-for-sale market, as owners who waited patiently to sell their business until the market improved have now started to sell. Just like a homeowner pondering the right opportunity to list his or her home, they wanted the market to improve so they could derive greater value from the sale.
Since 2013, we’ve seen a stronger economy that has led to an uptick in small-business listings. In the Keys, we saw the longtime owners of Key Bana Clothing in Key Colony Beach and Tropical Furniture in Marathon close their doors and settle in for retirement.
The national upswing in small business listings shows that one of the stronger motivations for that decision includes more baby-boomers reaching retirement age. But it still remains a dollar-and-cents decision, with prospective owners having more confidence to list their businesses and walk away with a fair price.
The median price of sold businesses increased to $450,000 this quarter, the highest level on record since BizBuySell started collecting data in 2007. Strong finances afford owners the leverage needed to ask for and receive higher prices for their businesses, evidenced by the median small business asking price, which grew 13 percent the past year.
At the other end of the spectrum, in the Keys, we are seeing large businesses starting to gobble up vacant real estate and empty storefronts. Wal-Mart has plans to anchor a 330,000-square-foot shopping center on Rockland Key. Mattress Firm, a 1,100-store bedding retailer based out of Houston, opened its second store in Marathon recently. Publix appears to be ready to break ground on a store in Islamorada.
This transition is unsettling for many Keys residents for a variety of reasons. There are traffic and population concerns, and fears that affordable housing for the workers that will staff these large retailers remains woefully inadequate. For some, it’s simply the fear of shedding another layer of our quaint, small-town structure for a less desirable, box-store-laden environment.
One way to balance this transition is to level the playing field, but those calls need to come from D.C. The Keys have controlled the influx of large retailers for some time but that tide is turning. The village of Islamorada fought Publix for years before losing a federal lawsuit to try to keep it out.
The pressure to feed the tax base and create a business landscape that serves our community is beginning to trump the desire to repel that growth. Our best bet is to manage the large-retailer infusion through the proper vetting process to ensure that a comfortable balance of large and small retailers is maintained as well as possible.
For hundreds of years, the Darwinian principle has applied to business health and sustainability. There is a very natural ebb and flow to business openings and closings. It may be a bitter pill for Keys residents to swallow, but we might need to get used to it.