Here’s A Transcript Of The Video: Do You Need A Valuation For Your Business?
Hello, Andrew Weaver at LawyerFair. This is a short video looking at how or indeed whether you should do a valuation for your business for sale. It could well be pretty short because my view is you shouldn’t even bother valuing the business pre-sale and you certainly shouldn’t pay for it.
Your business, whether it’s high-quality, high-growth business or not, will be shaped during the sales process by a couple of key areas. The first is preparation, how well and how clean the business is, whether you’ve got your contracts up to date, hopefully extended, whether you’ve got contracts at all.
Areas like cleaning up any little disputes or issues that might concern a buyer and enable a buyer to either price chip or walk away from the deal altogether. So, good preparation, upfront due diligence is really the way I would describe it, is absolutely crucial.
The second is marketing, making sure that you’ve got experts around you, a team of advisors who are experienced and that they’re driving some really interesting strategic trade buyers to the table, hopefully in the plural because clearly that will create a premium opportunity.
Those are the key areas that drive value. If you set a price at the beginning, who knows, you may well far exceed it if you just leave it to your advisors and to good preparation. You certainly shouldn’t pay an advisor who comes to you with a pre-sale valuation because it’s nonsense, frankly. They don’t know.
Every business is different. There isn’t any business that achieves exactly the same details. Of course sales price and value can erupt in many different ways, not necessarily just cash. It could also be related to deferred payments and earn-outs.
In short, don’t worry too much about pre-sale evaluation. Get maybe an indication. It’s about preparation and about strategic marketing. Thank you for watching. Andrew Weaver at LawyerFair.
Final Words: Do You Need A Valuation For Your Business?
So there you have it! These are the key areas that will shape the valuation of your business and get you the highest possible selling price if you choose to sell your business.
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