As the owner of your business, you no doubt know the inner workings of your business like the backs of your own hands. Indeed, your products and services, your customers, and the general day-to-day management and goals of your business are no doubt very familiar to you, and likely very close to your heart as well.
But do you know what your business is worth on the open market? Furthermore, do you know why understanding your business’ worth, even if you’re not planning on selling today, is important?
At Harvest Wealth Partners, we educate you about the importance of business valuation, the different business valuation methods available, and valuating your business for a competitive price.
Business valuation is the process of analyzing a business to determine the value of its assets, debts and liabilities, and overall worth. Business valuation is critical, as it helps a company to understand its role and place in its current market and industry, how to plan and strategize for the future, and what its options are should an emergency situation arise (i.e. the death of a shareholder, owner, market crash, etc.). What’s more, the United States Internal Revenue Services (IRS) will also need to know the value of a business in order to determine things like estate taxes and tax basis for a future sale.
There are three different valuation methods that are commonly used. These are:
At Harvest Wealth Partners, we believe that understanding the value of your business is an important tool to have as you plan for your business’ future. To learn more about business valuation, please contact us today.
*This page is provided for educational purposes only and is not intended to provide legal or tax advice. For legal or tax advice, please consult a qualified tax or legal advisor. Harvest Wealth Partners and LPL Financial do not provide business valuation services.
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