When you are looking to sell a business, there are many way to price that business, which your VR business intermediary can assist.

• Multiples of cash flow – Usually 1 to 3 times annual cash flow depending on the type and size of the business;
• Value of equipment and inventory – This includes one year’s cash flow;
• 3 to 12 monthly gross sales – Depending on the type of business;
• Book value of assets. 

Many elements will affect the price of the business:

• If there’s an earn out,
• Non-compete clause, 
• General attractiveness of the business, 
• Future potential, 
• How the business fits with the buyer’s strategic plan, 
• Size of the business – Larger businesses bring a higher multiple, 
• Rarity of the business, 
• If a business is a service business that’s tied to the seller’s relationships with customers, 
• Retail or other type of business with a skilled staff in place.

Your VR business intermediary will be able to show you which method to use per the type of business that you have as a business owner. With a database of comparable sales, your VR business intermediary will be able to show you what price you should for when you sell your business.