Valuing your Business
Establishing the true value of any business is a complex process where financial performance is considered in context with many other, more subjective factors. Identifying and quantifying these factors can have a significant impact on buyer appeal, greatly affecting the final sale price.
It involves a multifaceted approach that takes into account financial performance as well as various other, more subjective factors. Identifying and quantifying these factors can greatly influence the attractiveness of the business to potential buyers, thereby significantly impacting the overall transaction value.
There are a wide range of factors to consider from book value, right through to potential value.
In general, the value of the business will rely on an analysis of the company’s cash flow, its past, current and potential earnings, and the sustainability of those earnings. In other words, its ability to generate consistent profits will ultimately determine its worth in the ‘marketplace’.
We have facilitated the sale of well over 300 high-valued business across Australia
We have a focus on acquisition, divestment and facilitation of the sale of private companies, which has resulted in sale prices of between $1 million and $50 million. Our comprehensive database and the statistical evidence derived therefrom, together with our involvement with various industry statistical databases, indicates the value of those businesses with sound profitable history by using an ‘industry’ multiplier – the PE (Price to Earnings) Ratio. This multiplier fluctuates and is market sector driven.
However, whilst earnings history is key to most business valuations, the PE Ratio may not necessarily be the best indicator of value. Strong, but under-performing assets and revenue strengths, where price to sales will have an influence on the methodology used, can be equally important.
LINK’s valuation methodologies are tailored to specific industries and grounded in real-world market data and actual sale information.
Identify Risks, Barriers to Entry
Market Evidence
Multiple Methodologies
LINK's own valuation tool
Add-backs and account normalisation
Multiple weighting factors
The valuation methodologies used by LINK are industry specific, and are based on ‘real world’ market and sale information.
Identify Risks, Barriers to Entry
Market Evidence
Multiple Methodologies
LINK's own valuation tool
Add-backs and account normalisation
Multiple weighting factors
Remove the guesswork
Here at LINK we use our award-winning appraisal tool Valu.LINK to provide a detailed accurate business value appraisal based on global sales data and finely tuned algorithms.