Insights

What Is Business Valuation?

Before you sell your business or buy a business, it is vital to know the business’s value. Business valuation is the process of putting a price tag on a business or company unit in order to determine its economic value.  NBS looks at the following factors in order to place a value on your business:

  • Your business’s history.
  • A description of your business’ products, services, geographic market area, etc.
  • Your business’s marketing activities such as sales, distribution, customer base, and competition.
  • The organization structure of your business including management, key employees, compensation, and benefits.
  • The historical business financial statements.

NBS uses the above information and weighs the nature of the business, economic conditions, financial performance, and values of assets to arrive at a fair market value for a business. Knowing what a business is worth is essential for both the buyer and the seller to make sure each gets a good return on the money invested. *

Why Perform a Business Valuation?

If you are planning your exit strategy from your business, knowing the business’s value is essential. Without it, you could leave millions on the table. Getting a qualified estimate as to the fair market value of your business will help you make one of the most critical financial decisions of your life.