Whenever we are asked to value a business for sale, one of our roles is obviously to get the highest price possible for the seller. To do this however, we also need to take into account the position of any potential buyers and any issues that may affect the value of the business.
The overall market for selling businesses is much smaller than the market for buying and selling houses and with a smaller market in general often the strength lies with potential buyers in terms of their options and choices for buying different businesses. Having said that the owner should always be in control of the process as it is their own business they are selling.
Establishing the correct asking price for the business is the key to getting a good level of interest in the business to start with. More often than not, our suggested asking prices for the businesses we are marketing are potentially lower than what the owner of the business initially thought it was worth however we are able to see the point of view from buyers as well and are able to use this as well as comparative information we have to hand to make an assessment of the value. In the majority of cases we are usually fairly close to the actual selling price. On occasions the owner has wanted to set their own price and been able to get offers at that level and it a larger number of cases, owners have wanted to push the asking price to such a level that with very little interest, the property sticks on the market for a long period of time. It is often the case that when this happens 1 of 2 things will happen. Either the business will never sell because it is has lost its appeal to potential buyers or if it does sell, it sells for way below the suggested asking price.
Business Valuations can take many different forms but ultimately you need to think whether you would buy the business for the money you are asking for. Achieving a sale of a business can take time however to help speed up the process getting the right asking price agreed is usually a major hurdle to overcome.
We can assist you with giving our opinion on the likely sales price of the business and to take into consideration all of the different elements that make up that valuation. If your business is based in Essex and you would like to arrange a FREE valuation please get in touch.