What’s my business worth?
Jones needs a business valuation. In this case, he most likely needs a strategic valuation, a proactive valuation that will provide a fair market value for Wild & Wacky Widgets. The valuation may then be used as part of the company’s strategic plan for a possible sale or partner buyout down the road. Firms like Synergetic Finance are contracted to perform such a valuation. Sometimes firms only offer valuation services, while others – like Synergy – also offer consulting services to help business owners like Jones and Davis figure out where to go next.
In other situations, Jones may need an authoritative valuation. Performed by an independent third-party valuator like Synergy, this type of valuation places a fair value on a business. This valuation is done in cases where the value may be disputed, or included as an asset in tax court, a divorce or other litigation. An authoritative valuation is provided as an expert opinion on the value of a particular business. If Jones and Davis were involved in a lawsuit to divide the assets of the company, for example, they would need an authoritative valuation.
For more information about how business valuations are done or to find out what your business is worth, visit our website. We offer a graphic illustration to guide you through the process.