WE HAVE THE EXPERIENCE,EXPERTISE AND CREDENTIALS
• You may need to sell the business due to succession planning, retirement, health, divorce, or for family reasons.
• You may need debt or equity financing for expansion or due to cash flow problems. Potential financiers or investors will want to see that the business has sufficient worth. SBA Financing.
• You may be adding shareholders (or one or more shareholders may wish a buyout). In this case, share value will need to be determined.
Regardless of the reason, how much your business is worth depends on many factors, from the current state of the economy through your business’s balance sheet. If for example, similar businesses in your area have recently sold, the value of your business will be determined in large part by the selling price of the previous sales but it is not like valuing a home. Expertise and experience are the key and our Business Valuation Partner, Lou Pereira has the following Professional Designations;
ASA, Accredited Senior Appraiser, American Society of Appraisers
CBA, Certified Business Appraiser, Institute of Business Appraisers
CVA, Certified Valuation Analyst, National Association of Certified Valuators and Analysts
CBI, Certified Business Intermediary, International Business Brokers Association
Faculty Member, American Institute of Certified Public Accountants
Get It Done Right
Business owners should always hire an experienced business valuation firm. Many sellers think they know the value, but in most cases it takes professionals to arrive at the fair market value for the business. It is not like valuing a home. This is too much like asking a mother how talented her child is. Also the firm you hire should also be objective.
So to ensure that you set and get the best price when you’re selling a business, we recommend getting a business valuation done by a professional. Our valuation team has the following designations, (ASA), Accredited Senior Appraiser, (CBA), Certified Business Appraiser and (CVA), Certified Valuation Analyst along with a combined 20 years of experience.
A Business Valuator (or anyone valuating your business such as an accountant or M&A firm) will use a variety of business valuation methods to determine a fair price for your business, such as:
Three Business Valuation Methods
Basically, these business valuation methods total up all the investments in the business.
Asset-based business valuations can be done on a going concern or on a liquidation basis.
• A going concern asset-based approach lists the business’s net balance sheet value of its assets and subtracts the value of its liabilities.
• A liquidation asset-based approach determines the net cash that would be received if all assets were sold and liabilities paid off.
Using the asset-based approach to value a sole proprietorship is more difficult. In a corporation, all assets are owned by the company and would normally be included in a sale of the business. Assets in a sole proprietorship exist in the name of the owner and separating assets from business and personal use can be difficult.
For instance, a sole proprietor in a lawn care business may use various pieces of lawn care equipment for both business and personal use. A potential purchaser of the business would need to sort out which assets the owner intends to sell as part of the business.