Most business owners will, at some point, require the services of a business valuer. Business valuations in Perth are done for many reasons, whether as part of a business sale and exit, mergers and acquisition, to obtain a business loan, or part of a divorce. A business valuation gives how much the business is worth in assets and liabilities. The value supplied can also extrapolate the business’s growth and future potential, especially when selling it.
Given the importance of a business valuation exercise, one must pay attention to the key players in the process. A business valuer is a trained professional who uses their knowledge and experience to reach an estimated value indicating the worth of the business. The valuation report presented by your business valuer can negatively or positively affect how much you can demand in payment or loans; This is one more reason you should focus more on who you hire for the job.
Are you caught between hiring just anybody and looking for a certified and licensed professional? Below are some of the reasons you should always use a licensed valuer.
Valuations impact the value of transactions
As earlier stated, business valuations give an outsider a glimpse of your business and its worth. This means that as a business owner, the outcome of your business valuation can either improve or reduce your chances of securing a loan or commanding a higher amount in mergers or business sales.
Hiring a professional business valuer gives you the peace of mind that your business valuation will be done right. However, a licensed and experienced professional adds to your confidence level. With a licensed business and property valuer handling your business valuation needs, you can be sure that they will consider all factors surrounding your business and its value.
Licensed business valuers also give your partners a solid and uncontested appraisal of your business, whether the buyers or merging company; This means that you can easily conclude the deal without the other party hiring their valuers in hopes of a different outcome.
Professional Valuation Aids Decision-Making
Business owners who are caught in between selling or staying in business can leverage professional business valuation services to determine their growth over a period. Professional business valuers understand the current market trends and consider all liabilities and assets owned by a business, including their credits and debts. All of these go into the business valuation and can help business owners to reflect on their growth.
Businesses looking to exit the market, sell, or merge can also make solid decisions based on the business valuation report submitted by a professional valuer. Business owners looking to sell may demand more money based on the valuation report offered. Those entering into mergers and acquisitions may demand more power within the restructured organization based on their value to the table. For loan purposes, a valuation report gives the lender assurance that they’ll be able to recoup the amount demanded.
Buyers can also use business valuation reports for negotiating a fair deal. Understanding what the business of interest is worth can help shape their negotiation and expected purchase price.
Helps Prevent Losses and Lawsuits
Investors often make decisions based on numbers and their credibility. As a business owner seeking more investors, the chances are high that you may be sued for false or misleading information if your business valuation wasn’t done by a licensed professional. To avoid a legal mess, you must contact a professional and licensed business valuer to prepare your business valuation report.
Tips for choosing a Licensed Business Valuer
Business owners who understand the importance of working with a licensed valuer may face overwhelming challenges in choosing one. With the hundreds of business valuers available, business owners can stay safe and make the right choices when considering the following tips.
License and Certifications First
As a business owner, you should scrutinize a potential business valuer in all areas. The most paramount areas, however, are their license and certifications. A licensed and certified valuer offers a greater level of confidence to you, your business, and your stakeholders.
After considering their license and certification, you may also consider the associations they belong to as well as their years of experience. Belonging to a professional association will further strengthen the legitimacy of the business valuer’s claim. Their years of experience give an insight into how long they have been practicing and how capable they are of your business valuation needs. Older and more experienced valuers tend to do a better job.
Field of Expertise
Some valuers work mainly with small and medium-sized businesses, others offer property valuation services, and others are familiar with valuations for global businesses. To choose the right professional, consider their field of expertise and align with your business valuation needs. You must hire a professional with experience handling similar jobs as you have.
Valuation Methods
Business valuers use different methods to arrive at the estimated value of a business entity. Some valuation methods positively impact the business owner, while some favor the investors or buyers. It may be best to ask about the intended valuation methods and consider how the chosen method affects your business.
You should also ensure that the property valuation report contains the method used for your business valuation at the end of the exercise. This inclusion allows you to justify the value of your business and can save you from lawsuits in the future.
Objectivity and Independence
Whether a business owner or an investor, you need to work with a professional business valuer whose reports and valuations are objective, independent, and unbiased. Business valuers who have affiliations with parties interested in your business may present a biased report that may affect you now and in the future.
Getting a business valuation gives you a clear overview of your business is worth. Hiring licensed professionals guarantee your confidence in the valuation report submitted. Hire a business valuer by visiting https://www.businessvaluationperth.net.au.