Business Valuation: Discover how to value a business
Several elements play a role in a company valuation, and the price a potential buyer may be willing to pay. The bottom line is a our business value calculator can give an indication of the price range, however to value a company an indepth business value appraisal involves not only weighting factor, but other key components including risk profile, location and buyer demand. The list goes on!
So, how do you value a business
It’s common for business owners to think that the value of their business is simply net profit or gross sales multiplied by an industry rule of thumb. But what they perhaps don’t realise is that the value of a company’s intangible assets is often far greater than the tangible assets. However, valuing intangibles can be complex and requires expert knowledge and attentive analysis of many business facets. LINK’s expert business brokers can provide comprehensive insight into the valuation process, as well as help you increase your business’s worth to get it ready for the perfect sale.
Tangible Assets
- Real estate
- Plant, equipment, furniture and fittings
- Debts
- Machinery
Intangible Assets
- Goodwill
- Customer database
- Trademarks and copyrights
- Distribution rights
- A superior management team
- Non-compete agreements
- Physical location
- Brand recognition
- Special processes
The 4 key elements of a LINK business value appraisal
Economic
situation
It’s crucial to recognise that businesses do not exist in isolation; they are influenced by the environment in which they operate. Our approach considers not only the inherent factors but also the external elements that come into play when determining how to value a business. LINK’s appraisals take into account broader economic contexs at national, regional, and local levels on the valuation date, along with the specific industry conditions in which the business operates.
Accounts
Normalisation
Prospective buyers must gauge how much cashflow they can extract from the business without disrupting operations. Our company valuation appraoch employs various methods to adjust financial accounts, ensuring an accurate representation of this opportunity.
Financial
Analysis
A look at the financial statements of the business, using ratio, trend and industry comparative analysis tools to deliver a more scientific report on the financial state of the business. As the largest business brokerage in the world, LINK looks at industry comparisons both nationally and internationally.
Business
Market Value
Business valuation encompasses three broad approaches, each offering a range of techniques. At LINK, we carefully evaluate all three approaches before making a recommendation on which one to employ for a specific business.
Removing the
guesswork
Frequently asked questions
All sellers and buyers ask great questions about selling a business. Here are the answers to some we’ve heard before.
What is a business valuation?
How can I calculate the value of my business using a calculator?
What factors does the "Online Business Value Calculator" consider when valuing my business?
How can I determine the value of my small business accurately?
What are the key factors to consider when valuing a company?
Can you explain the process of valuing a business?
How do you value a business accurately?
Why is professional assistance essential in valuing my business?
Can I trust the valuations provided by LINK?
Contact us for a
confidential conversation
Our LINK Business Brokers are able to provide advice and insights that will improve the value of your business. Simply fill out the form below or call 0800 546 528 for an obligation free, and 100% confidential chat.
Confidential Conversation Form
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