Buying or selling a business is probably one of the most complex transactions there is. The task of establishing a realistic asking price, or for a buyer, an offering price, lies at the heart of the process and is certainly the most complex component of the overall selling or buying project.
My mission is to assist business owners in selling their businesses. To accomplish this goal it is imperative that prospective business owner/clients have a solid understanding of the many factors that influence the development of a reasonable asking price and obtain a professional opinion of their businesses’ value. The purpose of this whitepaper is to provide you with this information in order to guide you in establishing an asking price at which you can reasonably expect that someone will buy your business.
There are many factors that have a bearing on the development of a reasonable asking price for your business. The purpose of the remainder of this whitepaper is to identify these factors and explain how they should be taken into consideration as part of your asking price development process.
1. The differences between a broker’s price opinion and a certified business appraisal
2. What “Fair Market Value” means in the abstract and what it means to you
3. Terms used to define a businesses’ earnings
4. Recasting the income statements
5. Deal structure
6. Terms of sale
7. How the value of a company’s fixed operating equipment affects the company’s market value
8. Business value rules of thumb
9. Asking price versus selling price
10. Business broker commissions
About Toby Tatum
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