Business Valuation Tips

Are you valuing businesses with operations outside the United States? Then you would do well to consider compliance with the International Valuation Standards or IVS for short. Published and promulgated by the IVS Council, this key valuation standard has been adopted by most market economies world-wide. Standards build public trust As the IVS Council states,… Continue Reading

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Guess what keeps business appraisers busy and well paid. The fact that business people confuse the value, price or cost of businesses and business assets. But these are different things. Who says? The market. In fact, the market is where many participants express their opinions each and every day. So as your business appraiser would… Continue Reading

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Business appraisers try really hard to be objective in order to produce a realistic and well supported business valuation result. So can a business appraisal be objective and yet differ from another valuation of the same company by a different appraiser? The answer is yes. Why? Because business valuation is always about the future. So… Continue Reading

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Now this one may surprise some people. You might expect being unable to find an asset that shows up on the books. But businesses may have assets in use that have been written off with a value of zero. So a seasoned business appraiser who went through a physical inventory count will never overlook the… Continue Reading

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Value to whom? Now this one puzzles many a business person. Isn’t value of a business asset a single number? In other words, each asset has ‘the’ value. Not quite. Consider an example: A manufacturer of business equipment incurs costs of labor and materials to create a product. Let’s say the manufacturer calculates this as… Continue Reading

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If you do business valuations internationally, it is a good idea to find out what the International Valuation Standards (IVS) have to say about the choice of methods. The standards are accepted for business valuation across the globe these days. In some countries the IVS is the de-factor national standard for asset valuations. One key… Continue Reading

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You probably heard it often from companies: “Our people are our most valuable asset”. This may sound boring but the value of trained and assembled workforce is quite real. In fact, it is the employees that define the company and make it special. So what makes up the value of a workforce? In fact, it… Continue Reading

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Valuing a business? Then the need to figure out the discount and cap rates for minority and controlling investments may be in the cards. Appraisers call this step in the valuation process assessing the cost of capital. Reliable evidence you can use to figure out your cost of capital comes from the public capital markets.… Continue Reading

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Non-compete agreements happen quite often as part of a business sale. As a result, you should have a decent idea of the agreement’s value in order to allocate part of the business purchase price to it. Usually you would have a written contract obligating the business seller to refrain from setting up a competitive business… Continue Reading

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Why would you want to do business valuations in the past? Indeed, most business valuations are done as of the current date. The idea is to figure out what a company is worth right now. Yet once in a while, you may need to establish what the business was worth at some point in time… Continue Reading

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