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Our Business Valuation Service

Matt Vincent Sep 5, 2023 3:09:07 PM
Small business owner

Your business is probably one of your biggest asset - but do you know its actual market value? A Business Valuation is extremely useful whether you like to sell your business, adjust the ownership, borrow, or calculate your net worth.

 

The main selling points - Earnings and Assets

Strength of earnings and/or valuable assets will make any business more attractive. Other intangible factors like goodwill and potential can also play a part in adding a value. These can definitely make a business more saleable, but they aren’t always easy to put a price on. Coming up with an accurate valuation on a privately-owned business can be tricky.

The most common way to value a business in NZ is:

EBITDA x Industry multiplier

EBITDA stands for earnings before interest, tax, depreciation and amortisation. Each industry will have a multiplier, or one can be estimated by looking at other local and international sales. That’s a basic starting point, which can then be tweaked depending on the strengths or weaknesses of the individual company.

There are also plenty of other methods for arriving at a valuation. Sometimes a business will be sold for a multiple of revenue, or simply for asset value. There are so many variables that it’s tough to estimate on the back of an envelope.

DVA can help you find out your business' value

Book a 10 minute Consultation Call

Valuing a business is something our team at DVA can help you with. If you’re considering selling, we can help you put a value on your business, draw up accounts to show a potential purchaser, and give you ideas about how to get the best price.

You might need a business valuation for other reasons – for the bank, maybe, or for a staff share scheme. Once again, we can work with you to figure out what your business is worth. We’ll look at all its assets, its earnings and the intangible factors that make your business uniquely appealing.

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