Small Business Valuation

Having your business evaluated by a Chartered Accountant provides you with an accurate picture of what it is worth in the current market. A business valuation is important for business owners if you are looking to make any changes. Professional Chartered Business Valuators can give you an independent and fair valuation of your business to help with the process. Here is when you should get your business valuated:

If you are looking to sell your business you want to make sure that you know how much it is worth. Getting a business valuation can help you determine what valuation you should sell it at. The option for what to sell it at is up to you then, either at the valuation, below it, or above it. Having a valuation done is also a good negotiating factor because you can physically show buyers what your business is worth rather than having them just go on your word.

If you are considering expanding or buying another business, start off by getting a business valuation of what you already have. This could help with securing loans for expanding. It will also help determine if now is a good time for growing your business. If you are acquiring another business consider doing your own independent valuation of it. They may or may not have gotten one done but hiring someone you trust to evaluate on your behalf is always a good idea, especially for such a big decision.

Businesses, big or small, go through reorganization from time to time. If you are adding shareholders or new partners a valuation might be in order. When you know how much your business is worth you can judge what percentage to give to shareholders, partners, or investors based on how much they invest. If you think your business is worth $100,000 but your partner thinks it is worth $50,000, when they invest $5,000 you will end up arguing about what percentage they own. A valuation helps settle those disputes.

Estate Planning
Everyone at some point in their life will settle down to organize and plan their estate. This is usually done for the purposes of a will. As a business owner, you have the option to leave your ownership to someone else upon your death. It’s important to know how much your business is worth while you are planning this out especially if you are giving it to multiple people.

Matrimonial Separation
Unfortunately, marriage does not always work out. During a matrimonial separation, all assets are assessed and discussed. If you own a business, whether you own it together or separately, it will likely be up for discussion. Most likely you will get a business valuation done on it to determine how much it is worth. In most divorces assets are divided somewhat evenly, but that doesn’t mean everyone gets half of everything. If you want full ownership of your business you might exchange it for other assets of equal value.

Having an up to date and fair valuation of your business is never a bad idea. It gives you a good look at how much the business you spend your time running is worth. Contact us today if you would like to set up a business valuation.