How do I value a business I’m interested in buying?
Valuing a potential acquisition
Use multiple valuation methods. Asset‑based valuation subtracts liabilities from assets and is suitable for businesses with significant physical assetshttps://kewlegal.com/how-to-buy-an-existing-business/#:~:text=1.%20Asset. The earnings‑multiple approach multiplies annual net profit by an industry‑specific factor, typically 2–4 timeshttps://kewlegal.com/how-to-buy-an-existing-business/#:~:text=2. Market comparison estimates value based on recent sales of similar businesseshttps://kewlegal.com/how-to-buy-an-existing-business/#:~:text=3. Factors affecting price include industry trends, owner involvement, customer base, staff, reputation and scalabilityhttps://kewlegal.com/how-to-buy-an-existing-business/#:~:text=Other%20Things%20That%20Can%20Affect,Price. Hiring a professional appraiser provides a detailed and credible valuationhttps://www.investopedia.com/articles/pf/08/sell-small-business.asp#:~:text=Determine%20the%20value%20of%20your,provide%20you%20with%20a%20valuation. Our experts provide personalised valuation guidance and are available to discuss the value of your business. Reach out for friendly support and clear explanations.