Throughout the life of your business, the chances are, at some point you will require a formal business valuation. There are many reasons why this would be the case, and usually, business valuations are conducted for the following reasons.
- Estate Planning
- Divorce Settlement
- Refinancing or business loans
- Raising Capital
- Restructuring your Company ( Buy Ins – Sell Outs )
- Insurance Claims
- Selling or Exiting your Business
- Litigation
What is important to consider here is that a valuation is very different from an appraisal. Whereas an appraisal is usually an estimation of a price range conducted by a broker (mostly for the purposes of listing a business for sale in the marketplace), a valuation is conducted in a totally different manner. To begin with, it will usually contain a Conclusion of Value represented in a specific dollar amount, further, it is evidence based and presented in a logical, sequential and defendable format.