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Understanding Business Value
Net
Multiple
Ninety-eight percent of small businesses sell for between 1 and 5 years net income (1-5x). And about 70% sell for 2-3x net.
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At the end of the day, business value is the price a company’s tangible and intangible assets should bring in a competitive and open market, so the price, risk and returns are evaluated against other investments.
Value
Components
There are 5 key components of business value:
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Market value of assets.
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Historical trends of revenues, expenses, and cash flows.
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The value of rights, privileges, and knowledge.
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Estimated stability in the future.
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Esthetic appeal.
Valuation
Solutions
We perform third party business valuations and appraisals for:
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Business Sales
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Mergers
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Financing
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Insurable Value
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Litigation Support

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Liquidation or Reorganization
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Strategic Planning​
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