Valuing Businesses

Valuing businesses is not easy even if you know how. Valuing businesses is a complex matter and the valuation needs to be logical, sequential, and defendable, particularly if the valuation is challenged in court.

There are a myriad of issues to be canvassed and investigated before valuing a business. Do you base the valuation on one year’s profit or averaging several year’s profits? Do you use an owner-driven profit or an EBIT profit model? Do you use comparative sales data or use valuation theory? And what if the business is unusual or unique in its service, product, or other intellectual property it may have such as technology or patents or copyrights, or trademarks?

These are all questions best left to a specialist expert. Valuing businesses is best in the hands of a business valuer that will know which valuation model to apply when valuing businesses in your industry category. If you use a land valuer he may have no such knowledge.

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The contents do not constitute legal advice, are not intended to be a substitute for legal advice, and should not be relied upon as such for any purposes. You should seek legal advice or other professional advice in relation to any particular matters you or your organisation may have.