What Is My Business Worth?
Curious about the true value of your business? Our agents have decades of experience with small business valuations.
How We Determine Your Business Valuation
What Impacts Your Business Valuation?
Many things can affect the value of your company, including:
Size and Location
Ease of Transfer
Competition
Timing
Growth Rates & Industry Trends
Terms of the Sale
Quality of Books
Approaches for Valuing Your Company
The three generally accepted approaches to valuing a company.
Valuations: The Fine Print
The only person who can determine a business’s eventual sale price is the buyer. But we can get as close as possible by considering what your business will be worth if your past earnings are maintained after the purchase.
What is a small business multiple?
EBITDA (earnings before interest, taxes, depreciation and amortization) is used by larger businesses to represent the profit generated by the company. In selling small businesses (businesses earning less than 1 million dollars), Transworld uses the owner's benefit. Owner’s benefit equals the net income, plus depreciation, interest and the owner’s salary and fringe benefits. In other words, all the income available to one owner if the company is debt-free.
Are high multiples good?
Yes! Owner’s benefit multiples can range from less than one to about three. If your company is larger and your EBITDA is near or above one million, multiples can run from four to six. Multiples tend to rise with size, quality and verifiability of your owner’s benefit. Bad books, a dim future, negative growth and little profits will result in a low multiple. Excellent books, a bright future and excellent growth will garner a high multiple.
What does this mean for my listing vs. selling price?
You can use every valuation method available and still be surprised when the listing price and selling price are far apart. Nobody can tell you exactly what your business is worth: not your banker, CPA, lawyer, broker or mother-in-law. The only individual that will be able to tell you what your business is worth is the buyer — and that will be a subjective evaluation.
Recently Sold Businesses
Transworld is the industry leader business sales, with over 15,000 transactions completed by our network of 1,000+ brokers and M&A Advisors. Explore a sample of our recently sold listings below.
Leading Provider of School Meals in Northern California
Premium Hospitality Linens Operation 85+ Years
Aluminum Contractor
Ready to find out what your business is worth?
We’re here to answer your questions and help you reach a fair, subjective valuation.
