Business value is the #1 top-of-mind question from Buyers and Sellers. VR offers certified and professional business valuation and appraisal services to assist business owners in understanding their position in the marketplace and how their business is viewed by potential buyers.
|Missouri Botanical Gardens
When it comes to valuing and selling your business, you want the most reliable, accurate, and dependable information available. There are several different types of reports which are offered from different types of agencies. Not all valuation reports are created equal. In fact, you might say "it depends" when it comes to the value of your business based on who provides the valuation and how they determine the value of your business.
The cost of these reports will vary depending on the size of the business and scope of the appraisal. In all cases, the cost will be reasonable and will be fully credited back to you if the valuation report is related to buying or selling a business and, at the time of closing, if you buy or sell your business with our St. Louis office. The different types of reports we provide are described below:
Free Review of an existing Business Valuation or Business Appraisal (BVR): If you have a business valuation or business appraisal provided to you from another agency, or perhaps you received a copy from a business owner or investor regarding a business you are considering to purchase or invest in, and you would like a second opinion, we offer FREE reviews of existing appraisals that are no more than 12-months old. The Business Valuation Review (BVR) will help you identify focus areas in the valuation regarding business performance. (Why 12-months? Because the business financial data may have changed significantly since the last time the valuation was reported. The business could be performing better, or worse, than previously indicated and there are no financial institutions which will accept a valuation or an appraisal which is more than 12 months old.)
Certified Business Valuation (CBV): Better than your ordinary BPO (Broker's Price Opinion) or BOV (Broker's Opinion of Value), this is a certified and professional limited scope analysis using one or any combination of the asset approach, the income approach, and the market data approach, as appropriate, to determine the fair market value of the business. This report is intended to establish the value of small and “Main Street” businesses. The report is approximately 60-70 pages or more and the turnaround time is 10-14 days after receipt of all documentation, but could take longer in some circumstances. This report provides a detailed discussion and final summary of how the valuation conclusion was determined and includes market and industry information and other key elements to understand the value of your business. The report costs between $1,500 to $5,000, depending on the size and complexity of the business, and the report contains the following at a minimum:
Special Purpose Business Valuation or Appraisal (SPA): The SPA report is a certified and professional limited scope business valuation similar to the CBV, but includes considerably more detailed information and analysis in presenting the justifiable valuation of a business. This report is larger in volume and content than the CBV, takes about 15-30 days to complete, or longer in some circumstances, and provides a detailed review of all aspects that were considered in determining the final valuation conclusion. The bulk of the report is the financial analysis. The valuation conclusion is based on multiple valuation methods and/or industry specific valuation models rather than pure SDE or EBITDA. The report cost ranges from $5,000 to $10,000 and up, depending on the size and complexity of the business, and the report contains the following at a minimum:
- Historical Income Statement.
- Adjusted Cash Flow Statement (SDE).
- Comparable Sales (Market Approach).
- Summary of Common Size Financial Statistics.
- Summary Review of Each Valuation Approach.
- Valuation Conclusion.
- Historical Income Statement.
- Adjusted Cash Flow Statement (SDE).
- Complete Financial Statement Analysis.
- Common Size Analysis.
- Ratio Analysis.
- Economic Outlook.
- Comparable Sales.
- Valuation Approaches Considered & Methods Used.
- Valuation Conclusion and Justification.
ROBS Valuations: If your agency is a professional and experienced ROBS (Rollovers as Business Start-ups) retirement plan administrator, and if you need annual and periodic business valuations to comply with IRS ERISA rulings (Employees Retirement Income Security Act), then we can help you manage your business valuation requirements. Our office provides three types of reports: the CBV and SPV (as described above at reduced prices), or our standard ROBS valuation report, and each is offered for a special flat fee rate based on the volume of reports you need and how quickly you need them. Schedule a call with us for more details and to discuss the type of valuation reports you need.
Merger & Acquisition Valuation: The Merger & Acquisition Valuation is a comprehensive business valuation for transactional purposes and is developed in accordance with the Uniform Standards of Professional Appraisal Practice (USPAP). This valuation is intended primarily for mid-market companies with revenues in excess of $10,000,000 as well as for those companies that expect significant growth in the near and intermediate term. The basis of the valuation is future earnings with the historical performance playing a significant role in the valuation modeling to determine business value. The selection of guideline companies comes from both the private and public markets, which tends to make the valuation conclusion more aggressive. This report is completely customized and takes about 3 – 6 weeks to produce. The cost of these types of reports range considerably, but a good estimate for your planning and budget purposes is to assume around $10,000-$15,000 for smaller businesses with excellent financial records up to $20,000 or more for larger businesses, businesses with multiple branches, or significantly detailed financial records. You should also anticipate the assignment of a member of your team who has intimate knowledge of your business and easy access to financial records in order to assist the analyst in getting information and answering questions.
IMPORTANT: If you are asking for, or being offered, a BPO/BOV or formal business valuation or business appraisal and paying a fee for the report, ensure the analyst is certified and take the time to verify their credentials. There are only five approved agencies which can provide the appropriate certifications necessary to create such reports. The reports generated under the certifications of these five agencies are administered under strict rules and guidelines, high ethical and professional practices, and proven and accepted valuation standards. Additionally, the credibility of these reports when performed by a certified practitioner who holds one or more of these approved credentials can be upheld when applying for SBA loans, submitting IRS annual reports, and submissible and defendable in court proceedings.