Business Valuation Blog | Understanding Buying / Selling a Company

Business Valuation When Settling an Estate

Posted by Business Valuation Specialists LLC on Nov 6, 2023 7:30:00 AM

Estate Settlement for Small Business Valuation work with Appraiser

When there’s a need to settle someone’s estate, there are a lot of things to consider, and given the emotional component of this difficult and hectic time, it can become overwhelming. If the individual wholly owned or was a partner in a business, you will need to consider placing a value on these estate assets, to properly and fairly include them in the settlement. It’s important to work with an experienced independent appraiser who understands the best methodologies to consider and has no “skin in the game” that might create a biased opinion.

When reviewing the ongoing businesses under the estate, it is also a good idea to look ahead at how you believe the future of the company may be affected by the prior owner or partner no longer being involved. Is there an opportunity to sell the company before the effects of their absence take effect? Are there factors to consider in taking the company forward under new direction or management?

While you’re taking care of the short-term demands involved in settling the estate, discuss these more proactive topics with an appraisal professional who can provide options where the valuation might consider these additional perspectives. It’s often feasible for an appraisal consultant to assist not only with valuing the business as of the effective date under the estate settlement but also look ahead at a more current date for the purposes of a future sale or change in the structure of the company.

Before you decide which consultants to engage with during this trying time, inquire as to their ability to work with you on multiple fronts so you can accomplish more than the immediate objective and determine if they can assist with all or most of the concerns you may be thinking about today.

It’s difficult enough to handle all the tasks involved with settling an estate, especially if the individual owns a large number of assets. The more support you have to accomplish all these, the better your ability to manage everything in a timely and effective fashion.

If you are in the middle of an estate settlement, consider reaching out to professional consultants such as certified and accredited appraisers, who will be there the moment you need the assistance.

Tags: Business Valuation, small business valuation, appraiser, Estate Settlement

Business Valuation Relies on Complete and Accurate Financial Documents

Posted by Business Valuation Specialists LLC on Jul 3, 2023 7:30:00 AM

Small Business Business Valuations Financial Records

If you have owned a business for a number of years and now need an appraisal to sell the company, apply for financial assistance, or bring in new investors, you will need to have reliable financial documentation that provides historical performance details.

The most common records you will need are income statements, balance sheets, and tax filing records. You can provide further information by responding to a series of typical questions the valuation professional will ask during the process, that will give additional perspective on how to view these documents and make discretionary adjustments to the income and expenses of the business.

The appraiser will ask for 3-5 years of these filings, and they should be developed by an outside accounting agency or internal company controller. If you find yourself in a position where these records are not current, or poorly documented, you will need to determine the best way to update them, otherwise, the appraiser may not be able to assist you.

One option is to hire a forensic accountant or bookkeeper who can go through all the business receipts and related paperwork in an effort to develop formal documents which can be utilized for the appraisal as well as support these transactions. A potential buyer, financial institution, or investor is not going to blindly give you funding if the historical performance of the company is not well-detailed and documented.

Keep in mind the appraisal firm you engage with cannot actively participate in the development of these documents since they need to remain independent and unbiased when estimating their value opinions. As a business owner, you will know far more than anyone about the previous performance of the company as well as have access to the records needed to put these documents together. Whether you decide to take this project on yourself or work with an outside agency or internal employee, your direct involvement in the process will be critical.

Regardless of your immediate desire to put the business on the market, or look for new capital funding alternatives, take the time now to review your business records and determine if they are accurate and up to date. Even if they are, take further steps to organize a file to consolidate and provide easy access to, all the historical financial records of the company so that when the time comes, you will be prepared to move forward.

If you are unsure of the steps needed to complete this effort, contact a certified accountant or appraiser who can discuss the process further and give you informal advice that gets you on the right track.

Tags: small business valuation, business appraisers, small business, accounting

Old-School vs. New Small Business Practices - What Works Best For You

Posted by Business Valuation Specialists LLC on Oct 10, 2022 7:30:00 AM


Business Valuation Appraisals Small Business Practices

As a small business owner, I receive dozens of email “come-ons” every month advising me of wonderful new marketing, accounting, hiring practice methodologies, or related services that are supposed to increase my company’s effectiveness and efficiencies, leading to a healthier bottom line.

Personally, I have never followed up with any of these places, however, that doesn’t mean some may provide a useful service for my company. I just happen to be an old-school manager who has people I trust handling these kinds of things for me internally.

As a business owner, you should do what works best for you and your business. Have you been mired in the same processes for years without thinking of new ways to improve your business model? Are you a new start-up, ready to utilize the latest technologies, products, and services available to enter the market running at top speed?

In either case and for most business owners who are somewhere in between these two scenarios, you should keep an open mind about process improvements while continuing to rely on your own experience and expertise, as well as those of your coworkers. If you don’t have certain areas well covered at the moment, such as social media marketing, website development, or accounting software, it may be a good idea to research and engage reliable third-party companies who provide these services or look to hire those with the skill sets required to handle these key sectors of your business.

Consider if your goal is a long-term permanent improvement to your company’s capabilities or a shorter-term fix that can be solved with the help of an outside consultant. Depending on the industry you operate in, products such as accounting, valuation, and inventory management software, might be useful to consider acquiring. Other areas that are critical include marketing, website design, and search engine optimization.

Capitalizing on your past success and old-school work ethic, while staying current with the latest developments and capabilities in the business marketplace, will provide the best opportunity to be successful as you move forward with your small business. Take the time to review the strengths and weaknesses of the key components of your company’s current profile, and look to create a plan that will put you in the best position to succeed today and in the future.

Tags: small business valuation, business owners, small business

Is Your Small Business the Best Version of Itself?

Posted by Business Valuation Specialists LLC on Sep 12, 2022 7:30:00 AM


Business Valuation Appraisal Small Business Best Version

From a personal perspective, we all have stages in our life where we strive to become the best version of ourselves, by improving our overall lifestyle in areas such as health, career, and relationships. Small business owners should take a similar look at their company and ask the same questions. Is my operation the best version of itself or are there ways to significantly improve it in the coming years?

You know your business better than anyone, and like your own life, you can dig deep to break down the areas that can be updated, enhanced, and made more efficient with some introspection, that can be converted into new processes that ultimately increase revenue and net profits.

Some examples to consider:

Overhead Costs

Whether it’s a fixed or variable expense, what areas of your monthly overhead costs can be better controlled without sacrificing quality and efficiencies? Possibly cutting back on expensive trade shows or business meetings where travel costs are high, especially in today’s market. Review everything, from current subscriptions to the employee health care plan for ways in which you might be able to save money while keeping their benefits at the same levels.

Capital Resources

Are their less costly financing options available in the market to restructure your current debt? Would a fresh infusion of working capital allow you to invest in new growth opportunities?

Updating Your Fixed Assets & Maintenance Programs

Is your plant & equipment still functioning at the same levels as when they were originally acquired? Are you spending too much on maintenance as a result of poor operating efficiencies?

Employee Performance Levels

Are you getting the same commitment and output from your staff since the days when they were first hired? Is there room to consider adding personnel in areas that would have a direct payoff to increased revenue or cost savings? Would additional incentives lead to more productivity and increased revenue?

Market Expansion

Are there unexplored markets that complement your key business focus that could lead to additional clients and services? Are you happy with the current market share for the sectors you are entrenched in every day?

These are just a few of the areas to consider when looking to create a new and improved version of your business. Take a deep dive with the knowledge and experience you’ve developed over the years to make improvements and continue to have success.

Tags: Business Valuation, small business valuation, growth, stand out, improvements

How can your company benefit from a small business valuation?

Posted by Business Valuation Specialists LLC on Mar 7, 2018 3:11:00 PM

If you're considering getting a small business valuation, you're not alone. The primary reason small businesses are appraised typically has to do with selling the company or another type of change in ownership, such as passing it to the next generation. But if that's all you use a business valuation for, you're missing out on some serious benefits. Here's a quick look at the many benefits your company can gain outside of the negotiating room.

How can your company benefit from a small business valuation?

It's fairly common for a company to have a business valuation performed when a change in ownership is about to occur. This helps the departing owner know that they're getting a fair value for the business while the incoming owner knows that they're not paying too much for their new business. But the amount of information that is explored during the valuation process makes it an excellent tool to help you gauge whether your company is on the right track and performing up to its potential. How?

The valuation process starts by looking at a company's finances. The appraiser will look at potential transactions that will need to be recorded to normalize income and expenses to reflect the reality of the business, rather than rare high sales and significant expenses that skew your company's financial picture. It also looks at where your company's finances stand overall, giving you a better idea of whether you have a normal number of slow or bad debts from customers or if you need to crack down harder to get paid on time.

Next, it looks at your company's operations.  Is your business a leader in innovation and development in your industry? Is it running efficiently, or are there areas where improvements could be made to optimize your profitability and lower your overhead? The appraiser deals with companies like yours every day, so they can often provide strong, valuable insights into where your operation could be improved to optimize your productivity and profitability.

What about your company's place in the market? That's the next area that is typically explored. Does it have a strong reputation as a thought leader in the industry? Is it unique in particular areas that add value to the products and services you offer your clients? If you do have areas that are similar to competitors, those will be appraised as well as the areas where your company is truly unique.

Then there's the market itself. Is it currently growing, stagnating or shrinking? It's easy to get caught up in what your company has been doing in the market, but it's also important to know where it's going in the future. When the appraiser looks at your industry, they'll take into consideration any professional projections about future growth in the industry.

A small business valuation is a valuable tool that can be used to drastically improve your company's operation, performance and bottom line. However, if you aren't using a certified business valuation specialist for the process, you may be getting the wrong information. The certification process helps educate appraisers as to the proper approaches and methodologies to be used in a wide range of circumstances. Ensure that the money that you're investing in a business valuation is being well spent by using a certified business appraiser.

Tags: small business valuation

Valuing a Restaurant to Determine Your Direction

Posted by Business Valuation Specialists LLC on Mar 1, 2017 10:58:00 AM

valuing a restaurant.jpg

Whether your restaurant isn't doing as well as it used to or if you just want to take it in a new direction and don't know what will work, one way to gain those insights is by having a business appraisal performed. But what kind of information can you discover in the valuation of a company? What's the best way to have a company valuation performed on your restaurant? In this post, we'll discuss the ins and outs of business valuations as they pertain to the eatery industry and how you can use the information you gain to your business' benefit.

Valuing a Restaurant to Determine Your Direction

It could be that your business just isn't doing as well and you don't know why. Maybe you're considering changing to a different cuisine or theme and aren't certain exactly which concept would do best in your area. Perhaps you're getting ready to sell and aren't sure how to market your business' goodwill and reputation in the community. Whatever your situation is, getting a business appraisal is a great way to get a professional opinion about what you can expect in your restaurant.

A business appraisal specialist is trained to look at a variety of aspects in your business. If you've been losing business, is it because of competition or because your business has lost it's newness? A restaurant appraiser knows how to look at your financials to figure out which issue is causing the drain on your business financials. Would a change in theme or cuisine help boost sales or chase away your regular clientele? Instead of simply trying something and finding out later how badly it can impact your business, a business valuation specialist can help you think about specifics ahead of time. 

When it's time to sell your business, what is it really worth to a buyer? If the locals are coming in because it's just the convenient place to go, a buyer may be very interested in purchasing your establishment. But if it's because you've spent years developing the perfect cuisine for the area and a strong reputation in the community, potential buyers may need the reassurance that you'll help with the transition to new ownership. Otherwise they may have concerns about whether the business will remain solvent.

By getting a business appraisal on your restaurant, you'll have access to the best possible insights into what will and won't work to get your business back in shape. If you're not currently working with a certified appraisal specialist for your business appraisals, you could be missing out on the quality insights such an appraisal can bring to your business

Tags: small business valuation, valuing a restaurant

How to Find Quality Small Business Valuation Services

Posted by Business Valuation Specialists LLC on Oct 12, 2015 10:00:00 AM


When it comes to determining the valuation of a company, whether it's for an upcoming sale or merger or business planning purposes, there's no doubt that you need small business valuation services that will get the job done accurately the first time. Let's take a look at considerations when you're selecting the right firm to handle your business appraisals:

6 Traits of Quality Small Business Valuation Services

  1. They know how to valuate a business in different life cycle stages. The valuation of a business that is just starting up is very different than one that has been in successful operation for many years with a good reputation in the community. Good small business valuation services take that into account when determining the valuation of a business.
  2. They're willing to stand behind their work. Company valuation services that provide a quality valuation not only records the methodology used to develop the business valuations, they will back up the accuracy of the valuation against scrutiny.
  3. They're certfied business valuation specialists. Quality valuation firms will have Certified Valuation Analyst appraisers, which is issued by the National Association of Certified Valuators and Analysts or a certification from similar organizations. This certification means that the valuator has gone through rigorous training and are staying up to date with any changes that are happening in different industries or to appraisal practice as a whole. 
  4. They know how to apply a variety of approaches. Valuations can take different forms. A market approach is great for comparing to actual transactions. Income approaches take into account future income from the business and are often used in rapidly growing businesses.
  5. They're available and ready to move quickly. There's nothing as annoying as working with a valuation company that thinks it's okay to keep you on hold for weeks or months on end. Good valuation firms know that you need the data they provide quickly so you can take advantage of market conditions before they pass.
  6. They apply an integrated approach to your valuation and can provide value-added services. Having to work with a number of different businesses can be frustrating. Using a company that can work seamlessly with other business partners makes your job easier. Whatever industry your business is in, you need to be able to focus on what you do best - running your business. Companies that also have capabilities to offer certified machinery and equipment appraisals can also be a benefit to keep the valuation on track.

Though it's easy to have business valuation fall through the cracks in your to-do list, knowing what your business is worth and how to take advantage of market conditions is of vital importance to your overall bottom line. Working with a high-quality business valuation firm that understands small businesses helps your company grow.

Tags: small business valuation, small business valuation services, valuation services

Small Business Valuation: A Professional Opinion for Professionals

Posted by Business Valuation Specialists LLC on Oct 1, 2015 9:00:00 AM

Small business owners may be masters of multi-tasking, but they can not do everything.  While some small business owners know how to keep the books and can comprehend the legal terminology in a 10-page contract, very few have the training or expertise of a professional. When you run a small business, you depend on attorneys, accountants and other professionals to handle matters that are a crucial part of operating a company.

These professionals help keep your business running smoothly. They provide a variety of services. You can call on them for advice before you make a major business decision. At some point in time, your accountant, your lawyer, your banker, or your insurance agent, may want you to get a small business valuation. 

How do you Know if you Need a Business Appraisal?

Small business owners may be masters of multi-tasking, but they can not do everything.  While some small business owners know how to keep the books and can comprehend the legal terminology in a 10-page contract, very few have the training or expertise of a professional. When you run a small business, you depend on attorneys, accountants and other professionals to handle matters that are a crucial part of operating a company.

These professionals help keep your business running smoothly. They provide a variety of services. You can call on them for advice before you make a major business decision. At some point in time, your accountant, your lawyer, your banker, or your insurance agent, may want you to get a small business valuation.


An attorney may want the professional valuation of a company to support his client's case in a court of law. Legal disputes that turn into lawsuits can center around a disagreement between two parties over what a company is worth. If a husband and wife share ownership in a small business and decide to get a divorce, what will happen to the business? Maybe one spouse will get the business and the other will get the house? Maybe the judge will decree that the business be sold and the proceeds divided equally.  When a couple gets divorced, all marital assets, including the ownership interest in a small business need to be divided. Business valuations in dissolution cases are often required to be able to reach a fair and equitable settlement. 


A small business valuation can not be done properly without providing the business appraiser with data that indicates the company's financial position. An accountant is responsible for filing periodic reports, preparing tax returns and creating a variety of financial documents.  Business appraisals are only as good as the available company-specific data.


A company valuation may be a prerequisite to obtaining a bank loan for your business. Banks were once more amenable to lending money to small businesses, but after the financial crisis in 2008/2009, borrowers must meet a higher standard in order to qualify for a loan. A positive company valuation can help a company get a bank loan.

Insurance Agents 

The valuation of a company can be helpful when you need to buy insurance. Your agent can best help you determine how much and what type of insurance you need if he or she knows what your business is worth. Insurance can be purchased to cover losses to your facilities and equipment. It can be purchased to protect against loss in liability claims. In certain circumstances, business insurance will cover loss of income. A business appraisal is proof of the value of all of the physical assets of your business. 

Call a Certified Business Appraiser

If your attorney asks you what your business is worth today, would you be able to give him a good estimate? Without the benefit of a recent business appraisal, most business owners would have trouble answering that question. If you find yourself in a circumstance where you need an accurate report of your company's fair market value, call a certified business appraiser.

Tags: small business valuation