Whether your business partner is retiring or the relationship just isn’t working out, buying out their interest in the company gives you the chance to keep moving forward. Deciding to offer your partner a buyout is usually easy, but deciding how much the company is worth is often much more difficult. Getting a business appraisal from a seasoned professional can help move negotiations forward and ensure all parties receive a fair deal.

The Benefits of Having Your Business Appraised Before Buying Out Your Partner

An Objective Analysis

Both you and your partner likely have a strong emotional investment in the company you’ve built, which causes many owners to overestimate the value of your business. This tendency can make negotiations difficult if your partner insists on a price considerably higher than the business is worth. A business appraisal will give you an objective analysis of the company’s worth, based on projected revenues and the investment required. While this information is vital for getting the best deal possible, it’s important not to get fixated on that figure. Instead, consider the valuation a starting-off point for negotiations.

Deciding Whether a Buyout Is the Best Option

While buying out your partner may seem like the most obvious course of action, it may not always be the best financial choice. If the appraisal comes back lower than expected, you might want to consider other options. In some cases, dissolving the partnership entirely and starting a new business on your own may be a better use of your resources.
 

If you’re interested in selling or buying a business in the near future, the professionals at Zoellner Garten & Company will guide you to a successful sale or acquisition. Since the company was founded in 1988, they have helped numerous buyers and sellers throughout Southwestern Ohio, Northern Kentucky, across the United States to accomplish their dream of running a company. Call (513) 852-2400 to speak with an advisor, visit them online for more on their business appraisal services, and follow their Facebook for more advice and professional tips.