When selling your business is a priority, it’s an equally important priority to obtain fair market value for it. After all, you’ve put your blood, sweat and tears into building it. You should be rewarded when you sell it.
But how do you determine fair market value in a constantly fluctuating market?
Take a Look at Businesses Similar to Yours
A quick way to gauge your business’s value is by obtaining comps (comparisons) from businesses similar to yours. While not a true representation of what your business is worth, a simple internet search will give you a way to “ballpark” what the market might demand from the sale of your business. However, keep in mind that what you see online regarding asking prices of similar businesses doesn’t necessarily reflect what those businesses actually sell for.
Simple “Back-of-Napkin” Calculation
Most of the time, when selling your business you’ll take the total amount of revenue it generates and multiply it by a base variable to determine overall value. However, it’s difficult to compare two similar business values side by side when they are similar in revenue but total overhead may be substantially different. This is another “ballpark it” estimation that can give you a baseline idea of where to start in your valuation.
Go With a Business Broker
The tried and true method to getting your business appraised is to use a business broker when it comes to valuing and selling your business. A professional business broker will review your business using their experience and knowledge of the marketplace to inform on the real value you can expect when selling your business.
We provide a completely free & confidential opinion of value with no strings attached. As the MidSouth’s largest independent brokerage, we have sold all kinds of businesses, from one-man shops to large corporations who work with our Mergers & Acquisitions department.
A big advantage of working with us is that there are no up-front costs — you only pay us after your business sells.
Is It Time To Sell Your Business?
When you’re ready to get serious about selling your business, contact us for a private initial consultation. This can be done by phone or in person. We have multiple offices in the Southeast to accommodate our clients and we look forward to working with you.
At Alliant Capital Advisors, our only business is selling your business confidentially.