When it comes to buying or selling a business, the most important question you need to ask is – how much is it worth? Sure, there are other motivations behind a valuation, but business owners tend to follow this path when waving goodbye to their latest business venture.
There is no single formula that can be used to precisely value every private business. The seller will want to drive the price up, and potential buyers will want the opposite. Here at Nordens, we know the struggle of running a business. A good evaluation can give you a clearer overview of the financial health of your business, which can help you to pinpoint underperforming areas and focus on the approaches that are working well. If your staff want to buy or sell shares in your business, valuing your business can help you set a fair price.
Being weighed down by personal bias, confused by lack of relevant knowledge, and uncertain of the business’ future can further contort this process. And that’s exactly why we’ve created a tool that takes the confusion out of valuing a business.
When looking at the overall value of a business, there are a number of different valuation methods that are commonly used – from using earnings multiples, to calculating how much it would cost to create a similar business. The most common sides to size up are:
a) Tangible assets – also known as fixed assets or property, plant and equipment, is a term used in accounting for assets and property that cannot easily be converted into cash.
b) Intangible elements (or perceived value) – Some of the most valuable parts of a business may not appear on any balance sheet – these may include trademarks, reputation, branding, key people and the size and quality of the customer base.
We’ve fixed-up and fine-tuned a business valuation tool so you don’t have to worry about doing the maths, nor spending a penny for our answer. Click HERE to access our free business valuation tool.
Should you need a further more detailed valuation of your business, contact our expert team today on 02085300720 or email businessdevelopment@nordens.co.uk
