Are you thinking about selling your business but you don't even know where to begin? A good first step would be to figure out about how much money your company is actually worth before you begin receiving offers. That way, you'll have a general figure that you can use to evaluate the offers as they come in. Here are 3 tips that will help you get a good valuation for your business.
Compare With a Public Company If Possible
If you know you have a highly successful privately held business, a good place to get an idea of how much it might be worth would be to look at public companies in your sector or market. These companies have to publish are required to publish revenue results every year to investors. Do some research and find a few public companies that had comparable sales last year to what your company did. Then, take a look at the stock price of that company and how it is generally perceived within the industry. This won't give you all the information you need, of course, but it will at least give you a good starting point for your own business.
Don't Forget Property That Your Business Owns
When you sell your business, are you also handing over the office that the business is run in? Will this include every computer and piece of furniture in addition to the building itself? What about all those office supplies you have in storage? If you are handing over a significant piece of land, an office building and all that comes with it, that could potentially add hundreds of thousands or even millions of dollars to your bottom line. Make sure any discussion of your company's worth includes property that you own and not just the revenue that the company generates by selling products or services.
Get a Formal Evaluation
While you could attempt to go to an accountant or a corporate finance firm to try and get a valuation, the best option is likely to deal directly with a business valuation firm that specializes in giving formal valuations. Business valuation firms specialize in this kind of thing and therefore will leave no stone unturned when looking into your business. Once the valuation is made, some firms may also help you find a potential buyer, which can be incredibly helpful as it will allow you to stay focused on continuing to run your business until someone is found.
If you are trying to sell your privately owned business, take a look at the public sector and see if you can draw any comparisons. If not, the best choice might be to go to a professional business valuation firm for assistance. Make sure you take a full list of all property that your company owns in addition to the revenue that you generate. For more information, reach out to a business valuation firm, such as Integgra Advisory Services, today.