For More Information Call:

Russell Cohen
Transworld Business Brokers
5101 NW 21st Ave
Suite 300
Fort Lauderdale, FL 33309

Cell: (954) 646-7651
Office: (754) 224-3119
Fax: (954) 449-7674
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Business Valuations [ Back to Business Valuations ]

Adding Value to Your Business

If you are considering selling your business, remember that there are positive factors that influence value and those that detract from it. Looking at your business from a buyer's perspective is important since a prudent buyer will be adding and subtracting these various factors when arriving at an asking price. It is perhaps more important to recognize when the buyer arrives at a price at which he or she will leave the negotiations. Buyers naturally try to buy the business at the lowest possible price possible, however most also have a top price over which they are probably not willing to go. Here are some of the "high value" indicators as well as some of the "low value" indicators to consider when evaluating your business.

Indications of High Value

High sustainable cash flow
Room for the business to grow
Anticipated industry growth
Competitive advantage - location, area, etc.
Business niche
History and reputation
Low failure rate in industry
Modern, well maintained facility

Indications of Low Value

Customer concentration on a few major customers/clients
Reliance on owner
Poor financials
Distressed circumstances
Few assets
Product or service sensitivity
Poor outlook for industry - regulations, foreign competition, price cutting, discount stores, etc.

Considering the above factors and how to address them can help a seller look at the business through the eyes of a potential buyer. A professional business broker can help the business owner sort through the many areas that buyers consider when looking at a business and trying to arrive at an initial offering price.

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