In many cases, it is required to estimate the real value of a particular business. In modern conditions, turnover does not always reflect the real income of the owner, since it may not take into account costs. For this reason, the main factor affecting the value of a business is the income that the business generates.
Instructions
Step 1
For a qualitative assessment of the business, first of all, evaluate the entrepreneurial income, that is, the amount that the owner of the company earns every month after paying taxes and wages to the employees of the company. In addition to the profit of the enterprise, entrepreneurial income can also include the owner's salary, which he receives as the CEO of the enterprise, as well as the salaries of other family members working for the company.
Step 2
Find out if the business operates on its own or rented space. If a business operates on leased premises, Russian investors consider it acceptable if the price of the business is equal to the entrepreneurial income for 7-18 months. Sometimes investors, for some reason interested in acquiring a particular business, are willing to pay for the company an amount equal to income for 24-30 months. The profitability requirements for companies that are sold alongside owned real estate tend to be less demanding. A normal price is considered to be equal to the total profit for a period of two to five years.
Step 3
When assessing the value of a business, use one more criterion - the quantitative ratio of potential buyers and companies proposed for sale. In recent years, the greatest demand has been enjoyed by enterprises in the service sector, public catering and food business.
Step 4
Rate how high-tech the enterprise is. Companies that do not require specialized training are sold at relatively high prices. Thus, many investors regard car washes as enterprises whose development does not require original and costly marketing strategies, so the buyer is ready to pay more than 30 times the monthly profit for such an enterprise.
Step 5
Consider the possible risks. For some buyers, the absence of risk or dark sides in a trade justifies the higher price. A company with completely transparent accounting will have a great value, even if it does not have very high incomes.
Step 6
Assess the assets of the company. In the presence of high-tech and expensive equipment, as well as real estate, the liquidation value of such objects is added to the value of the cash flow.
Step 7
When evaluating a business, take into account the company's stable customer base and trained staff. Sometimes the business reputation of the company is also important.
