Whether buying or selling, it can be hard to get the valuation of a business right. Too low and the vendor will take offence, too high and the acquirer may regret not being more cautious.
To a certain extent the phrase ‘a business is only worth what someone is going to pay for it’ is true, but that doesn’t help when no offer has been made, and there is no clear benchmark for valuation.
With smaller SMEs the challenge is more complicated with add backs and adjustments needed to fully assess future operational profitability.
That’s where a full market valuation can help. We know how companies are valued by acquirers, therefore clients can understand what offer may be acceptable to the vendor; or for business sellers to understand what their business is worth.
So, we’d like to suggest, whether buying or selling, a new phrase for your consideration:
‘it’s never too early to get a valuation on a business’