By: Darren Grady
New Horizon Business Brokers
April 29, 2019
If you’re interested in Selling or Buying a business in today’s economy, here are a few ways to gauge its value.
All business transactions will start and end by answering this question.
There are a few ways to value a business, and no specific “right” way, though you could probably come up with several wrong ones. Ultimately, the business is worth whatever a qualified buyer believes it is worth, based on the criteria you set forth at a specific moment in time.
Therefore, there are several external factors to consider, as well as those a business owner can control. Considerations such as, past financial performance, current market trends, market disruptions due to innovation and technology, continuity of revenue, competition and future cash flow risks, plus much more.
One of the biggest mistakes smart business owners make… They don’t take the necessary steps to prepare their business for sale. This results in reduced market valuations, longer time on the market, and needless frustration.
Most buyers will start by looking at the overall condition and value of the business’s assets such as;