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How could I find out business worth?

 
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How could I find out business worth? - 12/6/2013 2:18:15 PM   
mlwhite79

 

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Joined: 11/7/2013
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Does anybody have experience or preference with a valuation tool that can help me understand what a business is worth? Thanks guys! :)
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RE: How could I find out business worth? - 12/6/2013 6:05:57 PM   
mitchemd

 

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There are plenty of websites that have "tools" to determine the value of a business. They are not worth the five minutes it takes to use them. To value a business you need to talk to a professional business broker, or a business valuation professional. These individuals have the training, knowledge, expertise, and experience to properly value a business. Contact a local broker today.

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Michael Mitchell

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RE: How could I find out business worth? - 12/10/2013 2:28:14 PM   
mlwhite79

 

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For somebody who doesn't want to spend $5k on a professional, is there an online service that could at least provide a ballpark estimate? it doesn't have to be free.

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RE: How could I find out business worth? - 12/11/2013 6:36:05 AM   
mitchemd

 

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There are several types of valuations, and the methodology and documentation vary depending on the use of the report. Because
business valuation is part art and part science, valuations are subject to the appraiser’s judgment, skill, quality and methodology.
Also, the purpose for your valuation needs to be considered. There are several generally recognized values.
Fair market value - The price at which the property would change hands between a willing buyer and a willing seller when the
former is not under any compulsion to buy and the latter is not under any compulsion to sell, both parties having reasonable
knowledge of the relevant facts. If you are considering selling your business, a good Business Broker will be able to determine
the likely selling price of your business. He may charge you a reasonable fee, or it may be done at no cost to you.
Fair value - Legal standards to value. Often used in divorce, partnership dissolution, and other legal issues. Because the valuation
is likely to be challenged in court, it is best to get a formal valuation by an accredited valuation professional. Other uses may
include a by-sell agreement, insurance needs, setting the price for lower mid-market businesses, and other matters that may be
subject to litigation down the road.
Within each of these categories there are several different approaches to determining value. A simple web based calculator
cannot possibly give you an accurate assessment of the value of your business. There are too many factors unique to your
business that cannot be modeled by a simple calculator. Talk to a business broker in your area as a starting point. He may be
able to provide you a market assessment, or he may direct you to a valuation professional.


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Michael Mitchell

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RE: How could I find out business worth? - 12/18/2013 3:21:47 PM   
mlwhite79

 

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I'm sure that brokers and valuation professionals are fantastic at what they do. However, I am just looking for an online tool that can give me a ballpark estimate. It doesn't have to be "simple" or free. Any recommendations?

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RE: How could I find out business worth? - 6/4/2016 3:06:19 PM   
jasonbaud1985

 

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Joined: 6/3/2016
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If you want to try an online tool it amazing what a Google search can find. However keep in mind that any result you get from software should be taken with a grain of salt.

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