Business Valuation Guide

Business valuation is necessary and can be extremely helpful in a variety of situations:

• You wish to buy a running business
• You wish to sell your business at a good price
• You wish to value the business in order to distribute assets to heirs/partners/family members or as part of divorce settlement
• It is required for certain legal procedures
• It is required when you wish to apply for a loan
• Shareholders may request it
• You want to know exact capital gains for income tax purpose
• You want to put a value on the market goodwill
• You want to know value so that you can pay stamp duty
• You want to know how much progress your business has made

There is no standard yardstick by which one can measure the value of a business and several variables can influence the price according to time and circumstances. As experts, we factor in everything to give you a true and correct value of your business.

Our evaluation may be based on the following and other methods as may be applicable to a particular business

• Sales quantum
• Revenues
• Profit margin
• Assets and liabilities
• Current position in market segment
• Competition
• Brand value in the market
• Future potential and growth prospects
• State of economy

Then there are several other relevant factors including but not limited to:

• The number of years the business has been in operation
• Products or services portfolio
• Online visibility
• Customer base
• Vendor rating
• Employee factors
• Margin of profit and quantum of sales
• Business assets – tangible and intangible including IP

Sales and distribution network

Location

Licenses, registrations, certificates, awards

Financials

Whether business is operational or it has stopped operations

Whether business is producer of goods or it is a dealer/franchisee and its operations are governed by rules laid down by principals