When you are selling a house or a commercial building, there are several things to consider when thinking about the right price to ask. You would get a real estate agent and they would help you find the appropriate market value and then adjust that based on the condition. A home inspection will help in this adjustment, but after that, it is fairly straight forward about setting the price. When you have to consider a different question, such as how to determine your business selling price, it is more complicated.
Just to sell the building and property, it would be fairly easy. The market value can be determined through an agent and talks can begin to set that price. The selling of the whole business, however, has many more components in it. You need to account for the building, the name or reputation, the stock still sitting on shelves or at remote locations. All of this and much more must go into the computation.
The building is, again, one thing. The remaining stock that is still on the shelves is another. The value of those can be determined based on the current replacement value. This is confirmed by price lists from current vendors. This is added to the building price.
The total amount of liabilities you have will have to be deducted from any value you have figured out. The liabilities are the bills that are still currently owed to anyone associated with the business. This means current invoices from vendors or municipal services.
Something else to list as a positive value is the accounts receivable. This consists of all of the sales that have not been paid for, yet. These will be paid in the normal course of business and will come in to the new owners. These are payments made to them based on the work you and your employees have done that has value, based on the expectation of full payment, weighted for normal loss calculations.
One of the things you may not think about is the value of the business name. This is called good will and is listed as an asset. The reputation you have built, over time, is valuable. Much of the actual value of your business is there. In other words, the potential for the new owners to succeed can be attributed to the name that people have grown to trust.
All of these computations may take a while to accomplish. This is one of the reasons that hiring a company that does this is a great idea. You will need them to ask you all of the questions that need to be asked to unearth the important answers. These questions and the answers are some things that you usually do not think about during normal day to day operation but are crucial in this period.
What you need from the sale of the entire business, not just the building and or property, is the best price. You want to make this transaction happen without a hit on your reputation. You want to get as much for the hard work you put into it as you can and that can give you the peace of mind you need to get on with the next phase of your life.
Just to sell the building and property, it would be fairly easy. The market value can be determined through an agent and talks can begin to set that price. The selling of the whole business, however, has many more components in it. You need to account for the building, the name or reputation, the stock still sitting on shelves or at remote locations. All of this and much more must go into the computation.
The building is, again, one thing. The remaining stock that is still on the shelves is another. The value of those can be determined based on the current replacement value. This is confirmed by price lists from current vendors. This is added to the building price.
The total amount of liabilities you have will have to be deducted from any value you have figured out. The liabilities are the bills that are still currently owed to anyone associated with the business. This means current invoices from vendors or municipal services.
Something else to list as a positive value is the accounts receivable. This consists of all of the sales that have not been paid for, yet. These will be paid in the normal course of business and will come in to the new owners. These are payments made to them based on the work you and your employees have done that has value, based on the expectation of full payment, weighted for normal loss calculations.
One of the things you may not think about is the value of the business name. This is called good will and is listed as an asset. The reputation you have built, over time, is valuable. Much of the actual value of your business is there. In other words, the potential for the new owners to succeed can be attributed to the name that people have grown to trust.
All of these computations may take a while to accomplish. This is one of the reasons that hiring a company that does this is a great idea. You will need them to ask you all of the questions that need to be asked to unearth the important answers. These questions and the answers are some things that you usually do not think about during normal day to day operation but are crucial in this period.
What you need from the sale of the entire business, not just the building and or property, is the best price. You want to make this transaction happen without a hit on your reputation. You want to get as much for the hard work you put into it as you can and that can give you the peace of mind you need to get on with the next phase of your life.
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If you would like to know how to determine your business selling price come and discuss this further with one of our expert brokers. Find our website that discloses all the info on http://www.businessbrokerexpertsinc.com/steps-in-selling.
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