Unlike some business Assets, determining the Value of a Business can be extraordinarily complex, requiring an analysis of an organization’s financial performance, Assets, risks, and opportunities. Before selling a business, setting a fair market price requires an expert valuation that takes into account all of its assets – tangible and intangible.  Understanding what a valuation is and why it’s a necessary part of the process can ensure that you get a fair price for your business.

What Is a Business Valuation?

The value of any successful business is usually higher than the sum of its tangible Assets – equipment and real estate holdings for example.  It incorporates elements such as the Earnings and Cash Flow the Business generates, strengths, weaknesses, and the always important future potential.  An appraiser will examine your company’s earnings history, trends, the value of your property, customer lists, and intellectual property to provide an objective estimate of your business’s worth. A thorough valuation should also take account any and all liabilities, real or potential, that could diminish the value in the eyes of potential buyers.

Why Getting a Valuation Is Important Before Selling a Business – and for other Reasons

When selling a business, the simple most important decision you’ll make is setting a price. Pricing your business too low could mean losing thousands of dollars, but asking too much will cause buyers to look elsewhere.  There are other reasons for obtaining a Business Valuation; they include divorce, buying out an owner, dissolving a partnership, obtaining financing, and others.

Buying or selling a business can be a complex process, which many owners often find daunting. Since 1988, Zoellner Garten & Co. has been serving business owners and investors throughout Cincinnati, northern Kentucky, and Dayton, OH, providing expert guidance through every step of the buying or selling process. Visit their website to learn more about their valuation and appraisal services, get more tips on Facebook, and call (513) 852-2400 for a consultation.