Put simply, “valuation” is what a buyer is willing to pay for your business. In practice, however, valuation is anything but simple and is often as much art as science. Here is a little bit of “Valuation 101”:
Valuation is not formulaic
Textbook formulas and “rules of thumb” alone are not adequate methods for valuing a business
Don’t leave money on the table by neglecting the intangible value of a business
Premium buyers analyze the future potential of an acquisition to determine value.
The intangible value of a business is worth a significant amount to the premium buyer.
How can the value of a business be increased?
By using sound market research, approaching the right buyers, running a competitive process and effectively structuring the deal, a business owner can maximize value when selling the company.
http://www.TotalBusiness.com is a Website that provides business owners with the information they need in order to successfully start, manage, grow, and sell their businesses.
The site features over 3,000 articles and 60 guides on business topics such as starting a business, financing a business, sales and marketing, building a website, setting up an office, hiring employees, and selling a business. The site also contains articles on legal and accounting issues affecting businesses and allows business owners and entrepreneurs to get free expert advice from local lawyers or accountants. The site contains over 1,000 business forms and agreements that are helpful to business owners and provides a business directory with over 1,700 merchants who provide services specifically for small businesses.
Eran Salu, JD, MBA, CPA is the Founder and CEO of TotalBusiness.com