Common and Scary Business Valuation Mistakes

There is a great deal of confusion when valuing a business and business sellers tend to make the same mistakes. The startling fact is that unfortunately, so-called professionals often repeatedly make these same mistakes.

Mistake # 1 – Applying a ‘one size fits all’ rule of thumb

While a one-size fits all valuation method is simple, unfortunately it does not result in accurate business valuations. Applying the average or median ratio as a one size fits all multiplier produces misleading and unfair results, particularly to the better businesses.

Mistake #2 – Neglecting to include Work In Progress (WIP) in business valuation

It is quite amazing how people who should know better often overlook WIP when valuing a business. WIP is a key element of the business value in both professional practices and contracting companies. In these environments there is usually valuable work in progress still to be invoiced.

Mistake #3 – Setting a price too soon.

You set yourself at an immediate disadvantage if you state a price without knowing the potential value of the business. Do not sell yourself short by setting a price too quickly. Assess the value of your business confidently with the Business Appraisal kit and then set a price. Remember, you can always come down, but you generally cannot go up once you have determined your selling price.

Mistake #4 – Not identifying the best buyers.

You need to spend time on serious buyers only. If a potential buyer is not pre-qualified or does not appear to be prepared to make an offer, you may very likely be wasting your time. Do not spend time with the wrong buyers.

Mistake #5 - Waiting too long to sell.

Many business owners regret not selling at the most opportune time. By waiting, they subsequently encounter increased competition or have a product that has declined in value because of economic conditions. If you are thinking of selling, pay attention to changes in the economy and to the state of your industry, and look for the best selling opportunity.

That’s only a few of the common mistakes! Alarming isn’t it?

It’s especially alarming when you consider how easy it is to avoid these pitfalls, simply by following the principles set out in our Business Appraisal Kit.

Make an investment in your future Today!

Everything you need to know about selling your business is included in this kit and explained in plain English, which means it's dead-easy to read and understand. This is why our one-of-a-kind Business Valuation and Appraisal Kit is such good value at just $297.00

Better still, it’s a digitally delivered system that can be downloaded immediately after your order is processed.

Our fully secured ecommerce system allows you to purchase and download your Business Valuation and Appraisal Kit safely. You can begin reading and discovering these amazing tools in just a few minutes and of course its 100% ATO tax deductable.

Immediate Download - $297.00 inc GST - click

BONUS

Purchase the Business Valuation Appraisal Kit this month for only $297.00 and get a 3 month Featured Business for Sale listing on www.sellingbusiness.com.au ($79.00 value) completely FREE