What is my business worth?
This is the #1 question asked by business owners. And for good reason!
It is a simple question with a very complex answer. A business can be valued using various methodologies, including Income Approach, Market or Asset Valuations. These valuations can bring various amounts for any given business. From our experience, each buyer looks at a business and will apply their own valuation models.
What do I get? What do I keep?
With any transaction, it is important to remember that the Purchase Price (What you get) is different than Net-Cash-at-Closing (What you keep). There can be a lot of things that make the difference between the two items. The Net-Cash-at-Closing is a combination of many items, including: Purchase Price, taxes, debt, employee vacation, cash balances, etc.
How much is enough?
We strive to get the highest amount and best terms for any of our clients. A business owner should ask, “how much is enough?” to accomplish their goals. If, for example, a client wants to retire after the transaction, then understanding their monthly spending, budgets for travel, and other financial needs is crucial. Before any business owner goes to market, understanding goals and post-transaction planning is a fundamental basis for making decisions at Faelon Partners.
Where do I start?
Selling a business is extremely complicated and can be very stressful. To help with this process, we recommend our proprietary Range of Value Report. Upon completion, you will have basic understanding of a potential transaction. We feel this is a great starting point for planning, and it organizes your company financial statements into a “sample transaction”. This helps business owners understand potential valuation, terms of payment, and cash projections for a transaction.
Exit Strategy Book
