Business Store and Financial Management

Once you’ve learned a few Small Business Valuation principles computing your own valuation based on some subjective assumptions is not as difficult as you might believe.

While facts are irrefutible, there are subjective judgements to be made by you about your required return on investment, and external market factors that are open to interpretation, that may ultimately determine your valuation outcome. It’s best in fact to come up with a range of valuations – good value, OK, and Oh that hurt’s.

If you’re on buying a business, some of the wisest words I’ve heard have been: Before you enter into any negotation, write down the maximum price you are prepared to pay, and if you can’t get below it, walk away.

Once you’re happy with your small business valuation(s), the trick is in convincing the other side of the transaction to see eye to eye with you on your decisions about those assumptions, and that’s where good negotiating skills, and creativity come into play.

This is where the money is to be made or lost in a business transaction, and why it pays to take good advice from a qualified small business valuation professional in your area of the world

So what about some key business valuation principles?

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