How Much Is My Business Worth
How do you answer the question: How much is my business worth?
Simply put, your business is worth what someone is willing to pay for it. Predicting that value is a little more complicated, and the best tool to use will depend on why you want to know. Select one of the most common reasons owners seek to know their business value below to find out the best tools to value your business:
Business Owners Looking to Sell Within Next Year
Step One: Get the Value of Your Business
If you’re looking to sell your business within the next year you’ll want a confidential and accurate business evaluation that reveals what the market will pay for your business, as it is, today. Our business brokers work closely with business owners to value their business through an Opinion of Value. An Opinion of Value allows you to dig into the expenses and profits of your business with the expert help of a business broker and to discover the most suitable go-to-market price for your business. This allows you to discover what we call “add-backs” or expenses which benefit an owner, and a buyer could count as profit. We offer a complimentary Opinion of Value to any business within our target market and for a reasonable fee to those outside our target market.
Step Two: Understand What Buyers Look For
You’ll also want to understand what buyers look for, how they will scrutinize your business, and how to ensure that your business is presented to buyers in the most attractive manner. For those business owners that decide to list their business with BBG’s business brokerage we offer “Seller Insights Coaching” to ensure that you understand the buyers' point of view, and prepare yourself and your business to successfully move through the selling process and realize maximum value from your business.
Business Owners Looking to Increase the Value of Their Business
Understanding the current value of your business is a great baseline for ensuring that your business will steadily increase in value and provide a return on your investment, when you are ready to sell. It might be 5, 10 or even 20 years away, but as a business owner you should know how to influence the value of your business. Some of the factors that maximize value might surprise you.
Step One: Understand How to Influence the Value of Your Business
The Value Builder Score takes 15 minutes to complete and is complimentary. The Score itself does not provide an opinion of market value for your business, but will calculate a “sellability” score and provide valuable information on how to increase the value of your business.
By electing to review your Value Builder full report with one of our Certified Value Builder advisors, you can learn a preliminary range of values for your business and receive a detailed analysis of the 8 Key Drivers of Value that resulted in your total score.
Step Two: Find Out the Current Market Value of Your Business (1-3 years before selling your business)
The harsh truth is that your business is only worth what someone is willing to pay for it. Many business owners incorrectly assume buyers are willing to pay for their years of blood, sweat, and tears bringing their business to where it is today. It's simply not true. Buyers pay for where your business is today - not for what it took for you to get it here. Regardless of when you're looking to sell it's essential that you receive an Opinion of Value (complimentary if you’re in our target market) to know what a buyer would be willing to pay for your business - as it is today. Knowing enables you to make decisions to influence the market value. Not knowing isn't an option if you want to sell for maximum value in the future.