What is Business Valuation?
Business valuation looks at the commercial value of a business as a whole, taking into consideration its assets and current market conditions.
Business assets include:-
- Business premises
- Intellectual property
- Business liabilities
- Business turnover
- Effective management
- Goodwill – including the value of the brand and trademark
When is Business Valuation relevant?
A business valuation can be relevant in a whole range of circumstances in particular:
- On purchasing a business
- On selling a business
- When a business faces insolvency proceedings
- When another business contract requires a professional business valuation.
Sometimes valuations will be sought for specific elements of a business such as commercial property or intellectual property.
Often business contracts will require a professional business valuation, but even when this is not requested, it is essential to engage professional advice both in determining business valuation and in preparing the documentation to implement any transfer of the business.