Business Valuation

[LittleMissPizza]

I have recently become very interested in learning more about business valuation and how say, business brokers help their clients determine at what price they should list their business for sale. I know there are occasional threads posted when someone is considering buying a business and whether or not they are getting a “good deal” or how they should price their particular store when selling but the advice is, obviously, specific for the OP’s specific situation. Do any of you TT’ers have any book recommendations, websites, etc that you have found worthwhile to learn more about valuation? I’d love to hear…

I did a quick search on Amazon for the top rated books on business valuation and then placed a hold on those books from my local library. I also plan on contacting my local SCORE office to see whether they have any mentors who are knowledgeable regarding this topic. I will be sure to pass along any pertinent info I come across as well. Thanks!

 

[Daddio]

If you are located where there is a college or university that teaches accounting, the professors are generally a good source of information. Having said that, I took 2 semesters of courses that were designed for business valuation. It is not something you will learn in a 1/2 hour meeting with the prof. :lol:

 

[bodegahwy]

I have taken about 120 hours of classes and passed the IBA exam to be a CBA. (Certified Business Appraisor) I agree with Dadio. A half hour worth of conversation will not even get you started on the subject.

You will find that business brokers, CPAs and Business Appraisors come at things from different directions. There are several ways to arrive at a value and not all of them are useful for any one kind of business or valuation purpose. In particular, I find that for small businesses (gross revenue UNDER 25 million for example) much of the material you will find in books in the library is useless.

If you want a short read that will give you a good understanding of some of the issues, have a look for a book titled “Pricing a Small Business for Sale” by Toby Tatum. I think it delivers the most realistic snap shot I have seen and does it in a way that does not require a degree in accounting to follow.