What Is My Business Worth?

Every business owner wonders what their Atlanta business for sale is worth. VR Business Brokers has correctly valued 100's of thousands of businesses since 1979.  When you work with a VR Intermediary to develop a valuation report, the goal is a simple one, the creation of an accurate and comprehensive document that will stand up to scrutiny. You will receive a professional business valuation that becomes the best tool to obtain maximum selling price. Without a professional valuation, a business owner must be prepared to defend his opinion of value. VR's depth of experience coupled with a vast knowledge of valuation will result in an expert opinion of value, delivered in a responsive, timely and efficient manner. VR has valued and sold virtually every type of business.

Small and mid-sized businesses typically depend on four key value factors:

• Seller's Discretionary Earnings (SDE)
• Risk
• Terms of the Sale
• Industry

Seller's Discretionary Earnings
The main factor of determining value for small and mid-sized businesses is the total cash flow benefiting the owner - also known as Seller's Discretionary Earnings (SDE). SDE is calculated using the following six categories:

1. Profit or loss as reported
2. Owner's Salary
3. Discretionary Expenses
4. Non-recurring Expenses
5. Non-cash Expenses
6. Expenses not included in the P&L

Once theses categories are added together and an SDE is developed, a multiplier is applied. The multiplier can range from 1 to 5 (or more), depending on many factors, to arrive at the appropriate value for the business.