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A. Neumann & Associates, LLC Business Valuations In Pennsylvania

Is your business worth 3X sales? Or 2.5X EBITDA? Or what about 2X gross or assets plus one year of sales? The fact is, a single ratio is always wrong! For accurate business valuation Pennsylvania, there are many factors to consider. Still, many business owners make the mistake of using a single ratio which can lead to leaving money on the table after a sale or they value the business to high it will not sell.

A Neumann and Associates with 25 years of experience is a reputation firm that can assist with business valuations Pennsylvania. 3 operations are evaluated during a business valuation, a review of comparative values in SIC Code, review of markets and competitors and weight assets, cash flow and market transaction. Only a certified business valuation from a third party can come up with a true fair market value.

A couple things are critical when obtaining a business valuation in Pennsylvania. First, confidentiality is of upmost importance. Next, it must be a certified business valuation and it must be conducted by a third party. A valuation performed by a party representing the buyer or seller will not be seen as objective or taken serious by the other side in a transaction. Only a third party can provide an objective and accurate true market value.

Now, there are some different methods to determine fair market value. You have an asset based approach using book value and good will. There is also the income based approach which uses the capitalization method and excess earnings. And you also have the market based approach using revenue, discretionary cash flow and normalized EBITDA.

So what drives value in a business valuation Pennsylvania? There are many value drivers, here are a handful: Profitability, consistency of growth, diverse customer base, management information systems, accurate P&L reporting system and attractive facility are all value drivers.

A common questions, is when should a business owner obtain a business valuation? For a business owner looking to sell, a certified business valuation is critical to obtain up front. The requirements for a valuation are 3 years of records, approximate asset listing, a mental summation of benefites and 1.5 hours of uninterrupted time at an offsite location to preserve confidentiality. 

Why is a valuation so important? The buyer will take you serious first. There will be justification for the asking price and the valuation will aid in the buyer obtaining financing. The business valuation Pennsylvania also provides a lot of pre-offer due diligence. Additionally, a valuation is less than 0.5% of a business transaction and reduces potential of seller’s remorse. 

It is estimated that 50% of 7 million business owners will sell in the next 15 years. Of these, 80% are not sold due to poor representation. 75% of business owners actually have no idea how they will exit from their business and most are universally wrong about the value or salability of their business.

Why is a valuation so important?  The buyer will take you serious first.  There will be justification for the asking price and the valuation will aid in the buyer obtaining financing.  The business valuation Pennsylvania also provides a lot of pre-offer due diligence.  Additionally, a valuation is less than 0.5% of a business transaction and reduces potential of seller’s remorse.

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Business Valuations In PA

One of the most common questions at A Neumann and Associates, PA Business Brokerage, is how do you determine the value of a business. This is a very important question as there are some misconceptions and risks if the worth of a business is not appraised correctly and by the right parties. For a PA Business Valuation, the only way to obtain true market value is with a certified business valuation conducted by an expert third party. So you are a business owner in Pennsylvania. You need a business valuation PA and maybe you are unsure how to go about it. By doing research, you can come up with numerous calculations to arrive at a value of the worth of your business. Well which formula do you use?

The answer is simple, none. There is not one single formula that can accurately determine true market value. In fact, there are not even a handful of them that together can establish an accurate reading on value. You will find large variations by using income multiplier formula, asset based formulas, calculation using net income, earnings, stock price calculations, etc. The variation is too great. There are huge risks in the misconception that formulas accurately determine value. Do they help, sure? But for PA Business Valuations there are many more things to consider.

One more major misconception is the belief that anyone can do a business valuation. If this is the belief, then most likely the business valuation will be done by the business broker representing the party. And this creates a conflict of interest that does not result in an objective determination of value. The party representing the seller will likely arrive at a very high valuation, while the party representing the buyer will come in low. For an accurate PA Business Valuation that is taken serious by both the buyer, seller, financers and anyone else involved it must be conducted by a third party. If not, the business valuation is basically useless when it comes to the business transaction.

Why do business owners need a business valuation? There are many reasons. For the purchase or sale of a business, a certified business valuation must be completed by of course a third party. The valuation wills not only show that the seller is serious, but it will be taken serious by the buyer as well and it will aid in the buyer obtaining financing. Business transactions are not the only reasons why business owners need PA business valuations. Often they are required for estate planning, refinancing, recapitalization, partnership splits, and divorce and even to evaluate opportunities to improve the business.There are many factors that go into valuing a business. Current market environment, recent similar sales, financing, interest rates, trends, supply, demand, regional, industry, government and global factors. These are just a few; there are many more factors that impact value, even potential, employee considerations, taxes and terms in a business transaction.

A Neumann and Associates specializes in business valuation PA using third party experts to provide certified business valuations. If you have any need to determine the value of a business, contact A Neumann and Associates for a free confidential consultation.

So you are a business owner in Pennsylvania.  You need a business valuation PA and maybe you are unsure how to go about it.  By doing research, you can come up with numerous calculations to arrive at a value of the worth of your business.

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Business Valuations In New Jersey

The success of a business transaction can have a major influence on business owners. In fact, most business owners only experience one exit in their life and most owners do not have any idea or plan of how they will exit. This lack of a plan and knowledge of business transactions can lead to major mistakes than can have a huge impact on a family and others lives. When in the right hands however, these mistakes can not only be avoided, but the business transaction can be a huge success resulting in a very positive impact on lives.
One of the major mistakes in a business transaction is determining true market value. A buyer does not want to pay much higher and a seller does not want to sell for much lower than true market value. As experts in business valuation NJ, A Neumann and Associates has completed thousands of Business Valuations. Confidentiality is key as is getting a Business Valuation from a professional third party to avoid any bias. In fact, most business buyers and financing underwriters will not take a business seller seriously if they do not have a professional, third party business valuation.

With 25 years of experience as a premiere and reputable Business Broker in New Jersey, A Neumann and Associates have been providing expert service to Business Owners including Business Valuations in NJ. The testimonials, track record and network of affiliates have long been a huge buying and selling advantage. As expert Business Valuations NJ specialists, they can assist business owners determine the true market value for any reason. Be it sale of the business, estate planning, financing, dissolution of a partnership, divorce or other reasons, you will be in expert hands with A Neumann and Associates.

A lot goes into a Business Valuations, a formula or calculation does not exist that can actively determine the true market value of a business. Many things have to be considered such as assets, profits, years in business, potential growth, similar business sales, economy, financing options, buyer demand, buyer and seller motivation, timing, terms, location, etc. Professional Business Valuations are a crucial part of business transactions. They are obtained only through professional third party experts.

Why a third party? This is an important question. When a business valuation is conducted by a party that is representing the buyer, it may not be objective. The valuation could be favorable and much lower than true market value. Similarly, a party representing a business seller can value a business much higher as that benefits their client.

A Neumann and Associates is just that, an expert business valuation firm in NJ. We not only have a guide on Business Valuations on the site but also a Sample Business Valuation Report. If you have a need for a business valuation New Jersey, look no further than A Neumann and Associates by requesting a confidential consultation at www.neumannassociates.com/contact.cfm.

A Neumann and Associates is just that, an expert business valuation firm in NJ. We not only have a guide on Business Valuations on the site but also a Sample Business Valuation Report. If you have a need for a business valuation New Jersey, look no further than A Neumann and Associates by requesting a confidential consultation at www.neumannassociates.com/contact.cfm.