Money & Finance
Ask SCORE                                                                        Word Count 382

Put a Value on Your Business

There are many reasons why you might want to place a value on your
business. Perhaps you’re thinking about taking on a partner who will buy into
the business.  Before that can happen, you both need to know what the
business is worth.

And you’ll certainly need a valuation or appraisal if you want to sell the
business. Other reasons you might need a valuation include divorce, spin-offs,
business disputes and liquidation. Or how about this: you might simply want
know.

Accurately valuing a small business, however, can be complicated. Most
entrepreneurs are capable of boosting the value of their businesses by 40
percent simply by paying attention to the things that make a business valuable.

Too often, business owners brush aside valuations, believing them necessary
only if they decide to sell. As a result, only about one in 20 small businesses
have done a formal valuation, according to the National Association of
Certified Valuation Analysts.    

You can determine the value of a business in many different ways, from quick
and cheap software-based calculations you do yourself, to full-scale, certified
valuations by professionals. The price range is enormous, from as little as $15
for the simplest software, to thousands for a detailed analysis performed by
certified pros. Business brokers, hoping to sell your business, may even do
them for free.

Try to match the person or method you use for a valuation with the reason you
are doing it. If the valuation is for loan purposes, for example, look for
someone who’s done small business valuations for that purpose.

The National Association of Certified Valuation Analysts (NACVA) offers a
free service online to help you find a business valuation expert in your area.
NACVA provides training, certification and support for professional valuators
in cities and towns nationwide. Look for the “Find a Valuator Directory” at the
Web site, www.nacva.com.

PriceYourBusiness.com offers simple small business valuation software you
can access online 24/7.  Results are quick and available anytime.

To learn more about valuing your small business, contact SCORE
"Counselors to America's Small Business." SCORE is a nonprofit
organization of more than 10,500 volunteer business counselors who provide
free, confidential business counseling and training workshops to small
business owners. Go to www.scoredm.org on the web or call (515) 284-4760
between the hours of 10:00 A.M. and 3:00 P.M. Monday through Friday.