8 Things That Drive the Value of a Business
There is no right way to value a business. In fact, as an advisor, you know that what works for one client might not work for another. The same can be said for adding value to a business. The value of a business can mean different things to different people but, at the end of the day, buyers pay more for profitable businesses that are growing quickly.
What do you say? Make more money? Hire better people? Those things are a given and you’d be hard-pressed to find an owner who wouldn’t take that advice. But many attributes that drive the value of your client’s company are hidden from view on a Profit & Loss statement. Therefore, we’ve seen many examples of two businesses, from the same industry, that had similar financial performances but received vastly different offers.
They say high cholesterol is the silent killer because people with high cholesterol don’t feel any different. Likewise, there are several silent “value killers” that may be quietly eroding the value of your client’s company.
John Warrillow, founder of The Value Builder System™ and the author of Built to Sell and The Automatic Customer, is an expert on building valuable companies that sell. He has identified eight factors that are most closely linked to getting a premium acquisition offer.
This upcoming presentation will help you diagnose these value killers. It will also help you identify for your clients the assets that will have surprising value in the hands of a strategic acquirer.
During this session, you’ll learn:
- List 8 value factors
- Contrast differences between two different business values in same industry
- Describe the difference between premium and discount acquisition offers
The broadcast will be held on Wednesday, March 14 at 1 PM ET. Register now.
About Exit Planning Institute:
The Exit Planning Institute (EPI) is an education company that provides exit planning education to advisors and middle market business owners. We view exit planning as a strategy, not an event.
EPI leads the professional services profession with the best industry content, ongoing support, and owner education platform, all of which align with our mission: Change the outcome.
Only 2 out of every 10 businesses that come to market actually sell. We want to increase the number of saleable businesses.
Only 30% of family businesses successfully transition to the second generation, only 12% transfer to the third, and the success rates diminish from there. We want to improve those intergenerational transitions.
Of those that succeed in the sale of their business, 75% experience “profound regret” within one year of exiting their business. We want to understand why and create strategies that achieve profound success, wealth, and satisfaction.
EPI is an education company, powered by an elite community of top advisors and owners, all focused toward creating a valuable, transferable future for the business marketplace.