Do you know the value of the business?
This is a very hard question as a business cannot be valued like a piece of land or a share on the stock market. A business value is made up of a number of factors which all contribute to its future maintainable profit (FMP).
Generally, you should not buy a business that merely replaces a paycheque because the business needs to outperform what you could earn working for somebody else so that it can reward you for the risks and the disadvantages of owning your own business.
We use our business acumen together with a due diligence skill set to identify whether a business is over or under priced. As a part of this process we also want to analyse any potential opportunities together with the possible financial risks of purchasing their business. For example, would you buy a business that made coal powered cars? Probably not.
Always remember, the higher the risk, the higher the return needs to be to reward you for that risk … there is no such thing as a risk free return.
Business valuations and due diligence engagements
Our business valuation experts can provide easy to understand and practical solutions that combine due diligence skills and business valuation reports to give business owners and prospective buyers assurance in knowing the real value of the business and confidence in being able to negotiate a fair price when buying or selling a business.
Process involves three key elements
- Identifying all relevant assets and liabilities and collecting all financial and material non-financial variables. In other words … What’s for Sale?
- Adjusting published financial information to allow for non-commercial private and excluded transactions to arrive at the FMP.
- Including non financial influences such as competition, product life cycle, key personnel, tenancy security, key customers and suppliers to enable us to calculate a risk/return multiple that can be applied to the FMP to calculate the true value of a business.
Business valuation Services are required when:
- Buying a business
- Selling a Business
- Divorce Proceedings
- Making a Loan Applications
- Raising Equity
- Net Worth Analysis
- Drafting Wills
We have been a local firm for over 80 years which satisfies the need for a thorough knowledge of the business, industry in which it operates, combined with the local understanding. This combination gives us a clear focus on any material circumstances which may influence the valuation outcome.
A sound methodology is required to compensate for any non-commercial transactions because a clear and in depth due diligence or valuation report can provide additional confidence in the negotiation process.
All business entities need a sound understanding of their business value. A business valuation or due diligence exercise can identify weaknesses in a business, establish areas requiring strengthening to increase the business value. Once completed, this task can greatly increase the ability to achieve maximum value of the business when the owners are ready to sell or retire.
Our business valuation experts have been serving the accounting industry for over 30 years and possess intimate knowledge of the local economy, business operations and structural know-how.
We also appreciate that many businesses are family owned and operated, which is why we strive to help you provide consistent business outcomes during transitional periods, ensuring productivity and business growth is maintained.
Our team values a balanced work/family lifestyle, providing projects in a timely manner through collaboration and innovative solutions.
The most consistent feedback we receive from our clients is:
- Our team is approachable, friendly and smart
- Highly trained professional & team focussed
- We provide solutions to your problems
- We offer a hands-on approach to project management
- We consistently deliver our analysis on time!