How To Value A Small Business
760-422-5541
California Real Estate Co.
UNDERSTANDING BUSINESS VALUE
VALUATION
SOLUTIONS
If you're thinking of buying or selling a business we can help determine what it's worth.
We also perform third party business valuations and appraisals for:
-
Financing
-
Insurable Value
-
Litigation Support
-
Liquidation or Reorganization
-
Strategic Planning
VALUE
COMPONENTS
There are 5 key components of business value:
-
Market value of assets.
-
Historical trends of revenues, expenses, and cash flows.
-
The value of rights, privileges, and knowledge.
-
Estimated stability in the future.
-
Esthetic appeal.
NET
MULTIPLE
Ninety-eight percent of small businesses sell for between 1 and 5 years net income (1-5x). And about 70% sell for 2-3x net.
At the end of the day, business value is the price a company’s tangible and intangible assets should bring in a competitive and open market, so the price, risk and returns are evaluated against other investments.
If you want to get real nerdy with us -- and also read about how business size and industry affect valuation -- check out our in depth article below.
And if you'd like to speak with us directly, give us a ring or shoot us an email at info@quigleypumpernickel.com.