Valuing a Business

Company valuation or valuing a business is an essential requirement if you are planning to either buy or sell a business. Often required in a divorce settlement or if a business owner is seeking outside funding.

Please call or email for a further information. A link is provided if you wish to review a sample business valuation report. If you wish to try and learn business valuation on your own I provided a link to a book and software program available from Amazon. Click on the banner image in the left column.

Business Owners - Do you know what your business is really worth? Whether you are considering selling, seeking expansion financing, looking for a partner or investor, we can help.

Business Buyers - Do you know what that business you are considering buying really worth? Don't just take the business owner's or broker valuation. Find out independently for yourself. Quickly, easily and inexpensively find the fair-market value before you make an expensive commitment.

Although there are many variations of ways to estimate the value of a business, they tend to group with three possible approaches:

Asset Based Valuation
Market Comparison Valuation
Income Based Valuation

Our method uses the most commonly used approach for a small to medium-sized business (defined as a business with annual sales of $15 million or less); an Income Based Valuation. The Income Based Valuation approach is further broken down into four generally accepted methods:

Present Value of Future Earning
Gross Revenue Multiples
Capitalization of Excess Earnings
Multiple of Discretionary Earnings

Our method is a combination of both the widely used and professionally accepted Capitalization of Excess Earnings and the Multiple of Discretionary Earnings.

Specifics

We can calculate the fair market value of any type of business that has at least three years of income and expense data. We can even estimate the business potential value using your projections if you have less than three years of data.

We can easily determine the fair market valuation of any business including retail, wholesale, manufacturing, service, restaurants of all kinds, construction, distributors, franchises, transportation, lodging, heath care, professional, to name a few.

We will:

Determine the actual and projected available cash flow.
Calculate the risk-factor multiplier used in determining the business value.
Factor-in the current assets and adjust for the liabilities to be assumed.
Determine the Goodwill and intangible asset value.
Calculate the overall business value including all assets and liabilities.

We will create:

Reconstructed Income and Expense Statements
Available Cash Flow Projections
Continued Operations Risk Assessments and a Valuation Multiplier
A Capitalized Valuation Estimate (the fair market value)
A Business Valuation Letter Report
A Business Valuation and Sale Prospectus Report

Contained in the Valuation Reports

All financial data sheets (Income and Expense Reconstruction, Multiplier Calculation, Valuation Calculation and Valuation Calculation Summary and Goodwill, A Cover and Preface.

Additionally, a Formal Business Valuation and Sales Prospectus Report will include all the above plus Certification and sections covering: Business Origin, Ownership and Control, Nature of the Business, Principal Customers, Primary Suppliers, Key Employee Personnel, Company Facilities, Property and Location, Reason for the Sale, Pending Litigation, Financial History, Reconstructed Income and Expenses, Valuation Opinion and Analysis, Supporting Data and Documentation.