OLD Inc. Business Broker's valuation department has been performing small business valuations for almost 20 years using state-of-the-art valuation software. With a high level of accuracy in its interpretation of what buyers would be prepared to pay for the business/company affording its clients the opportunity to assess the reality of their expectations and determine if they prefer to stay or go.

A proper valuation considering the purpose thereof, is essential when selling a business/company for multiple reasons including:

1. Company Owner Expectations:

Accuracy in interpreting what the market would deem the value of one’s company/business to be is essential in assessing one’s own expectations. Should there be a gap in value between the assessment and one’s expectations, value building or value creation action can be initiated in order to bring the value in line with the expectations. Whether a valuation is under one’s expectations, or over, it is important to consider such gaps in order to not waste opportunities or leave money on the table.

Besides reasonable assumptions and considerations, a proper valuation must take into account various factors such as historical performance, future projections, efficiencies, assets, liabilities, market conditions and economic environments, growth opportunities, possible synergies, return on one’s investment, risk, potential, industry trends, and multiple value drivers to arrive at an objective price.

2. Buyer Trust:

Aside from a good fit from both a seller and a buyer’s perspective, a potential buyer is likely to be much more trusting of the value they receive for the anticipated purchase, if they can trust that its value has been accurately assessed, and the expectations are realistic. A proper valuation also helps one understand the value drivers and also to justify the expected price to a buyer at times of need or where a negotiation takes place relative to value. Such buyer trust will also enhance the sell side negotiating power.

3. Maximizing Seller Return on (often) Lifetime Investment:

Selling a business/company is often driven by the desire to maximize return on investment while exiting at an opportune time. A proper valuation helps identify areas where improvements can be made before selling, in order to increase and maximize the business’/company’s overall value.