Any business valuers on here

[Jayne]

Hi,

Are any of you lot on here professional business valuers, for people who need to know what their business is worth to sell? (aimed at small businesses)

Thanks

Jayne :D

[Urban Space]

Can't say I've heard of anyone on here that's a business valuer. I think you look at annual turnover to value it. Thinking of selling up Jayne?

Liam

[Jayne]

It's for my biz wally :lol:

I sell ad space for businesses and someone asked if I knew one.

Jayne

[MarkPearson]

Hi Jayne,

Would be interesting to see how people 'value' a business.

I know this is a very complex area, but whats a ruff guide?

[MinuWeb]

web based business are normally valued at between 6 months and 12 months turnover.

[Jayne]

I wanted to find a valuer, then when my customers ask me for one to value their biz, I can send them there way.

I don't know how to value businesses, that's why I need someone who can :D

Jayne

[multilingual]

There are some business valuers on here so I would expect one of them to answer your question in a more detailed way than mine, but the general rule of thumb tends to be that a business is worth three times its net profit plus tangible assets.

There are many more factors to take into account though, so it's not aplicable to all companies.

For example Fred Jones's the plumber might be making £40K per annum but if Fred wants to sell up he has a problem because without Fred Jones in charge the business is worthless.

If a business is reliant on the owner then the value is lower than if it is fully automated and the owner can sit on a beach and do nothing.

There are lots of different things to take into consideration, but three times net profit, plus tangible assets, is about as close as you can get without going into specific details.

JB

[Jayne]

Thanks Jonathan,

I'm looking for an expert to link to my site, for my customers to use. Then they can choose not to use an estate agent if they want, it'll be much cheaper for them.

Jayne :D

[Steve Roberts]

I buy and sell companies so I spend half my life valuing businesses. However, they tend to be larger companies than what you're referring to I think. For example, we sold a company today for just under £5m - but this would be in the upper quartile of our deals.

[multilingual]

I was looking around last year at buying a printing business and went all over the country looking at different companies for sale.

I would say that in every single case the businesses were overvalued by the selling agent because whenever I actually sat down with the owners, and picked through their accounts, the valuations never stacked up.

I did once ask an agent how he had arrived at his valuation, but was simply told that it was not an ethical question for me to be asking!

JB

[Astaroth]

There are many different methodologies for valuing companies (and these vary over time). For small businesses I am sure that a simple calculation can be done on the basis of assests and turnover however all my experience has been in much larger corporations.

Generally speaking though the actual tangable assets presently only make up 30% of the valuation with the remaining being made up of intangables like "brand" and future potential.

The basic profit calculations can work reasonably well for a company that is currently maintaining steady profits without growth and no obvious recent changes in the market. As soon as you remove any of these conditions you then need to factor in future predictions. Eg if you are wanting to buy a bakers (one of two on the high street) and the second one has recently burnt down you would expect to have to pay a higher premium as the business should be able to capitalise on the reduction in competition.

At the end of the day - anything is only worth what someone is willing to pay for it.