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Why a Business Valuation Analysis is Important to Your Company’s Value

All business owners need to consider a business valuation, ideally updated annually. A current business valuation is important for your company’s financial health as it can:

Give you an accurate picture of what your company is really worth — and how transferable that value can be — this provides a realistic picture of your company’s value should you decide to sell. It also provides a window into your ability to grow the business and how much money a bank would be willing to lend to support that growth.
Help you to plan for a faster sale — proper planning delivers more lucrative and successful sales of small businesses, as it gives a business owner time to increase the company’s worth before the sale, and to sell quickly.

Protect your family if something happens to you. John Warrillow, founder of The Value Builder System, writes that illness is the number one event that forces business owners to sell. A business valuation analysis can identify ways to create a more transferrable business in the event of illness or death.

Overall, a business valuation professional can provide you with an exact value of your company and help you develop a long-term plan to increase its value. Valuation strategies can help you increase profitability by helping you:

Identify prospective opportunities for sales growth
Implement cost-cutting strategies that maximize profits
Increase employee retention and save money on hiring and training
Develop systems and processes to increase the odds of a successful transition to the new owners, whoever they may be

If you or your client is interested in increasing a company’s value, please contact Seth Webber 

 

 

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