Business valuations have been used for many purposes. We recently did a NH business valuation because a partner died, and his spouse wanted to know what the business was worth to the estate. Not a happy occasion but one that will at some point be relevant for us all. When it comes to estates, owners will often have the valuation done as part of estate planning as well.
Divorce is another reason for a business valuation. ROI recently completed a RI business valuation for a divorce settlement. And we completed a business valuation in MA for a partnership buy out. We also recently did a business valuation in MA for a father to son gifting of business stock.
So as you can see there are multiple reason for business valuations. They come in several forms. An opinion of value is a basic document costing less than a full certified valuation but still provides a solid number. This can be used to transfer ownership in an arm’s length transaction or sale. The other forms, sighted above, tend to be Certified Valuations , which means they provide more back up and multiple approaches to value. They are completed by preparers who have specific credentials such as a CVA (Certified Valuation Analyst). ROI can provide Certified Valuations or Opinions of Value and we will recommend the least expensive but effective alternative for your needs.
By far the reason we see the most valuation requests is to determine value prior to a sale.
A good business valuation or opinion of value can give a business owner valuable insight. For instance, you may not be selling your business for years to come but there is still good reason in understanding business value.
An opinion of value can not only tell you how much your business is worth … but why! That can prove to be a road map to increasing value. In most cases when you increase value it is because you reduced risks and increased positive cash flow. Understanding how to accomplish an increase in value not only helps later but can put more money in your pocket now! ROI has a Value Maker Program that provides an opinion of value and then a 10 point tune up on how to improve value (and therefore profits and reducing operating risk). The Value Maker Program is perfect if an owner is considering exiting in the next few years. This allows time to maximize business value prior to exiting. A valuation is like a point on a map. If you are lost in the woods and want to find a road, you must first determine where you are on the map before choosing a direction to take. A valuation and specifically a Value Maker Program report can help you understand your base line business value and why. More importantly what, often simple, steps can be taken to decrease business risk and increase profitability and value in short order.
The Value Maker System is available to businesses of all kinds, but is a particularly great fit for
manufacturing companies, distribution companies, service companies, and medical related practices.
If used properly, a business valuation can guide important business decisions such as strategizing growth while increasing business value and provide a better understanding of how circumstances, whether in or out of your control, can affect the company’s finances and value. What kind of valuation is best for you? An opinion of value or a formal business valuation? Contact us today and we will be glad to guide you in the best direction.
Mr. Rayberg assisted in the sale of a business for the first time in 1984. In the years following he started, built and sold 6 more companies. He founded ROI Corporation in 1997 and his firm has been involved in managing transactions involving the sale of businesses and real estate in 39 states. In 2005 the company began to focus exclusively in the sale and valuation of businesses including third party sales, in family transitions and key employee buyouts.
Gary is a past President of the New England Business Brokers Association. (NEBBA) He is also a founding board member and current Chair of the Business Brokers Alliance of New England (BBANE) which is the business sales MLS system in the northeast. He is recognized in New England as a leader in his profession.
He is a member of the IBBA (International Business Brokers Association) where he has received the professional designation of CBI. (Certified Business Intermediary). He was also a member of IBA (Institute of Business Appraisers) where he has received training in business valuation. He is a member of the M&A Source, the largest M&A trade association in the world where he has received the M&AMI (Mergers and Acquisitions Master Intermediary) which has been awarded to less than 150 professionals world wide and is awarded after peer review of completed transactions. He is a licensed principal broker in the four states where his firm operates. (MA, NH, RI and GA) Note… In NH the firm is registered with the Secretary of State under the DBA “Business Brokerage and Valuation Services”. Mr. Rayberg is involved in the valuing and the marketing of dozens of companies each year.