Business Valuations – why have them?

Many business owners have no idea how much their business is actually worth – certainly the ones we talk to anyway!

And it’s not really surprising as there’s a lot of miss-information about how businesses are valued and then there are some brokers who grossly over-value businesses without any reason or justification, other than to seek upfront fees from business owners who might be thinking of selling!

A common view from business owners is that “the business is worth what someone is prepared to pay”.

And whilst that may be true, it doesn’t put you in a strong negotiating position if you don’t know what the business is worth “on paper” in the first place! So, for obvious reasons, a business owner selling a business, does not want to be told by a buyer how much their business is worth!

The whole subject of valuing a business is a confusing one for many business owners, as there are half a dozen different ways to value a business not to mention its own terminology to get your head around.

And then we have minority shareholders who might want to know how much their shares are worth – is there a Shareholders Agreement in place to explain how the value of their shares is to be calculated? Should a discount apply?

Sometimes, it’s a good idea to buy-out minority shareholders, particularly the ones who give you the most hassle, let you do all the hard work and contribute very little.

Maybe employees have a share purchase scheme to provide a sense of ownership to take a vested interest in the future growth and development of the business?

Whether they do or don’t, it’s good idea to know what the business is worth from a strategic planning point of view, no matter how good or bad things are. A business valuation exercise can provide that “starting point” from where you are today, to where you want to be, say in two or three years’ time.

A valuation exercise can help not only determine what the value of the business is today but can project what it might be worth in the future, with your current and future plans.

If you would like to consider an independent business valuation exercise, simply complete the form below and we’ll tell you what we need and we’ll provide you with a free sample business valuation letter and sample business valuation full report….

“I was very impressed with the quality, a well drafted report brought together in such a short period of time. Thank you very much for the excellent help when needed most.”  EO

“We required a valuation for an EMI share scheme and were provided a number of options which included HMRC approval.  I’d recommend Stirling for their competitive, efficient and hassle free valuation service.” Shelley Wood Co-Founder, Director Gemba Advantage Ltd. 

“Thank you for your service! I’m happy to say the report was provided fast with all the details mentioned, all the appropriate questions been asked. We will be pleased to work with you in future!”  Oksana Eftimiadi, Finance Netcracker Technology

 

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