Appraising Your Business

As we know and understand the market, our trained business brokers add value to the business sales process. Using data supplied by you, we will appraise your business using the best method to come up with a value or range of values that we believe your business will sell for on today’s market.

One method, which is the most common method, is to use the statistics of like sales; however, this is a guide only as many factors can come into the final sale price as the process moves forward.

The only true test of value is an “armslength sale” after a full marketing programme has been completed. The selling price may vary according to the motivation and negotiating skills of the parties involved.

Small and Medium Enterprises (SME’s) with fewer than 20 employees with the owner working in the business, make up the majority of business sales in New Zealand. The price to market is generally appraised by arriving at a Cash Surplus to a working owner, as most buyers want to know how much they will earn by working in the business.

Larger businesses that are truly managed are usually appraised using an EBITDA profit and then by using “Super Profits” to arrive at a price to market. Your broker will guide you through this process.

Get in touch with our team to learn more