Business Valuation for Selling or Buying a Business
If you’re like many business owners, you’ve spent the last 20 to 30 years building your company thinking you would sell it “someday.” Now that day is nearly here. Who will you sell to? How much would they actually pay? What will it cost to sell my business? What will be my tax bill? It is best to plan for the sale of your business a few years in advance, 3 to 5 years. We can help you no matter when you want to sell your business, even at the very end, which is probably where you are right now.
Cutting corners on the preparation and sales process can have a major impact on the amount you receive and the terms you can sell under. Our vast experience and business perspective at Business Valuation Appraisals will help you prepare your business to sell to the right buyer at the right price, with the right terms and protections for you. You can feel confident that you’ve sold your business the right way.
Let's face it, your business is perhaps the most important and valuable asset that you own. When it's time to sell your business, you owe it to yourself to work with a reputable advisory firm like Denver Business Valuations with direct experience in the M&A and business sales market. We have a passion for valuing businesses, getting them ready to sell.
Business Valuations Appraisals has the knowledge, experience and capability to act on your behalf to obtain the best deal possible. We are always looking for a win-win situation for all parties. From inception to a successful close and beyond, we are tenacious in preparing the business for sale by determining the optimum price for the business, and structuring the terms for the business transfer that will be acceptable to both the seller and to the buyer. Our professional, certified valuation is the best way to begin the process.
Business Broker vs Certified Business Valuator
Business valuations done by business brokers are called broker’s opinion of value. Our company is a certified business valuation company. We perform valuations that are certified. There is quite a difference between a broker’s opinion and a certified business valuation. The main difference deals with independence and objectivity.
You may be contemplating selling your business and don’t know where to start. You may have heard that you need a business valuation performed so that you can determine the best selling price. While there are many different levels of service that both a business broker and certified business valuation company can offer, including limited consulting services or an opinion of value, for purposes of this video we are going to assume you want a full opinion of value without any scope limitations.
A certified business valuation company charge fees based on hourly rates or a flat fee. Receiving fees based on contingency or outcome is a violation of our code of professional conduct. Business brokers generally do not charge fees for their brokers’ opinion but instead receive commission on the successful sale of the business.
A certified business valuation is allowed for SBA loans, IRS matters, litigation, and bank financing. Brokers’ options are not allowed for these types matters. Greater amount of professionalism and analysis is put into a certified business valuation. Generally, certified business valuations from different companies will actually result in similar values, because they follow prescribed rules. Accuracy is high with certified valuations.
A certified business valuation must follow the guidelines of professional standard setting bodies. They advocate for their own opinion of value, and not for the business they are valuing. Since a business brokers’ opinion is to receive a financial benefit from their opinion, their goal is to sell a business quickly, which generally means a low price so that the business can sell quicker. Business brokers cannot be independent or objective without a reason to do so.
When selling your house, it is generally required to get a certified home appraisal. Your real estate broker cannot be the home appraiser as well. The independence and objectivity of a certified home appraiser gives you the best price for your home. With a business generally being more valuable than a home, does it really make sense to not get a certified valuation? Do you want take that risk of not getting a certified business valuation? Would you take that risk on your home?
One could argue that the cost of certified valuation is too high. Yes, any cost over a free brokers’ opinion is higher. But when thousands if not millions of dollars are at stake, do you want to take the risk of not being accurate? Business brokers’ opinions tend to value a business lower and may not be reliable for your needs in our experience of seeing hundreds of businesses being sold.
Our business valuation group and advisors uses a team-based approach of multiple accredited business appraisers who work full-time together to meet the level of service our clients need. Whether it’s business value consulting services or a written opinion of value, we are here to help. Additionally, as a full-service staff, we can not only assist you with those challenges related to valuing your business, but also provide services related to your operations management, accounting, tax, and assurance needs. We know all aspects of business.
Our team at Business Valuation Appraisals provides the certified and accurate valuation your business needs to achieve the best price you can get for your business.
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