WAYNE T. PRICE

Florida Today

Bob and Mike Sirounis have a stethoscope on the local and regional economy.

As owners of Melbourne-based Harbor City Business Brokers, they comb the small- and medium-size business community looking to hook up buyers with sellers and vice versa. The Sirounis brothers recently purchased, for an undisclosed amount, their top competitor, Brevard Business Brokers, making Harbor City Business Brokers a main player in the fairly specialized field of buying and selling businesses.

Because they're constantly speaking with buyers and sellers about their motivations, business brokers are in a good position to spot economic trends in the local and regional economies. They can tell you why people are selling, what fields tend to be growing and what sectors are cutting back.

So, is the economy better than what we read in the newspaper or hear on the nightly newscast?

"The economy is not much better than what we hear in the news," Bob Sirounis said. "Perception is reality in our industry, as financing for buyers is not as readily available. With the downturn in the housing market, buyers have seen the equity in their homes diminish and therefore must look elsewhere for funds. Financial institutions have instituted more stringent lending requirements."

His thoughts are echoed by his peers, according to a recent survey of nearly 2,000 members of the International Business Brokers Association.

The survey asked members about their outlook on industry trends and expectations for 2008.

Among the results:

--- Nearly half of respondents (41 percent) indicate they expect the economy to be slightly down in 2008, and 10 percent say they expect it to be significantly down.

--- Nearly three-quarters (73 percent) say 2008 will be a buyer's market.

--- A similar number (76 percent) believe that more businesses will be available for sale in the coming year, and 80 percent are predicting that they will sell more companies.

"While it's an election year and there are concerns about the economy, the continuing trend of baby boomers looking to sell and retire will provide a lot of opportunities this year," said Cress Diglio, International Business Brokers Association's current chairman and president of Orlando-based Corporate Investment International.

"But it's also clear in the survey that many IBBA members feel that money will be tight and the number of sellers will easily outpace the number of qualified buyers."

Ups and downs

So, what small business sectors in Brevard are growing, and which are cutting back?

Lou Vescio, owner of Sunbelt Business Brokers in Melbourne, said specialty retail businesses are growing, as are business-to-business operations, such as janitorial and transportation services.

Not doing so good are businesses linked to the residential construction industry -- plumbing and electrical contractors, for example.

"That's probably to be expected," said Vescio, who teaches courses at Brevard Community College for people seeking to sell their business and those looking to start one.

John Stivers, owner of Professional Business Brokers Inc. in Suntree, agrees that businesses related to residential construction are hurting right now.

He said service-related businesses, including pest controloperators and lawn maintenance companies, are doing OK.

"They always seem to be able to weather any storm well," Stivers said.

Jim Baker, president and owner of Matchmaker Business Services on Merritt Island, said "anything residential construction related is dead."

He noted one client was trying to sell his business at $900,000 and then dropped it to $200,000.

"He can't even get a bite at $200,000," Baker said.

Whether the economy is booming or slowing, brokers said operating a small business is a tall order. The most common statistics brokers use goes like this: 80 percent of all small businesses fail within the first five years. Of those remaining, 80 percent will fail in the next five.

Motivations mixed

Bob Sirounis said the reasons he hears for people buying and selling businesses in Brevard are, as expected, varied.

Sellers' motivations usually are that they retiring or moving out of the area. Also, some have health problems and can't run their business.

On the other side, many buyers are tapping an entrepreneurial spirit and looking to have a greater say in their own destiny.

"Some buyers look for a change in careers, or better opportunity and others are entrepreneurs looking to secure their own future," Bob Sirounis said. "As job security and cutbacks become an issue in the corporate world, people are looking to stabilize their income. Many other buyers are moving into the area from other Florida counties and states."

The Sirounis brothers, both licensed Realtors in the Sunshine State, purchased Harbor City Business Brokers six years ago. The company covers all of Florida, concentrating primarily in Brevard and Central Florida, but advertises nationally and globally through numerous business Web sites and newspapers.

They decided to acquire Brevard Business Brokers in January because it was an established company that had been in existence for more than 15 years in Brevard, and they wanted to expand Harbor City Business Brokers, which helped broker 80 Brevard businesses last year and 21 through the first nine weeks of this year.

"A lot of businesses are seeing a slowdown and the owners want to move on to other things," Bob Sirounis said.

In Florida, there currently are about 6,000 businesses for sale, according to the multiple listing service provided by Business Brokers of Florida, the non-profit organization made up of leading business brokers in the state.

Last year, business brokers did about $553 million in transactions, according to the state group.

Back in business

One deal the Sirounis brothers helped broker was Ron and Susan Miles' purchase of the Palm Bay-based Wood 'N You, a 14-person enterprise that manufactures doors and wood trim. The Mileses cut short an early retirement on a yacht because stock market woes hurt their investments.

They have differing thoughts on the state of the Brevard economy.

"My husband believes the light at the end of the tunnel is coming soon," said Susan Miles, who is a little more unsure.

"But business recently picked up and showed improvement, and we hope it will continue to improve."

Another small business operator brokered by the Sirounis brothers was the sale of Express Employment Professionals in West Melbourne to Jeeta and Sanjay Saxena. The business is a full-service employment agency.

Jeeta Saxena is staying upbeat about the economy.

"I believe in the American spirit and I think we'll get through this," she said.

Contact Price at 242-3658 or wprice@floridatoday.com.