Valuation – What is It?
Business Valuation is an assessment process that determines the economic worth of a business. Financial advisors use valuation to ascertain the selling price for a business. Often, establishing a company’s worth is the first serious step in determining whether or not it makes sense to sell. Valuation begins with the compilation of a business’s financial data. Once all of the pertinent business information is compiled, an advisor can generate an assessment of your business’s value.
Valuation – Who Does It?
Which company you select to conduct your business valuation is important since the valuation becomes a cornerstone for future business actions. Ideally, a company with years of M&A experience and broad industry knowledge should complete your valuation.
A mergers & acquisitions company with extended reach across several states, including Minnesota would be a primary candidate. Such a company’s core services would include business valuation. Minneapolis business advisors from these kinds of firms are often specialists in valuations, private equity investment, mergers, divestitures and acquisitions.
Valuation — What are the Benefits?
* A business valuation is essential if your business is at a crossroads, that is, if you are pondering selling, merging with another company, or expanding through acquisition. It is especially critical if you are intending to sell as it establishes a benchmark for a selling price and determines your negotiating power.
* A valuation documents the basic financial condition of your business in the current market. Such a valuation is helpful in evaluating your business and for establishing new business strategies.
* A valuation provides an opportunity to work with a business advisory company to determine next steps with your business.
Valuation – Next Steps?
Like most financial assessments, valuations are not 100% precise. In fact, like a home for sale, the exact value of a company is only determined when the company is sold. However, a valuation is a very good estimate and working with a business advisory company becomes as important as the valuation. The valuation becomes a vehicle for partnering with the advisory company to review the assessment and develop purposeful strategies in response to the valuation.
Sunbelt is the leading company in mergers & acquisitions in the world, having handled more than $1 billion in transactions. To learn more about our advisory services or to engage us as your business advisor, go to http://www.sunbelt-business-advisors.com.
