VR Mergers & Acquisitions / VR Business Brokers located in Austin, Texas
What is a fair price for a business in Austin?
Like any other product, a business is worth whatever a willing buyer will pay a seller in a free market. However, the value of most businesses in the Austin area is related to cash flow and varies with the financing terms agreed upon. Price will also depend on the type of business, the value of the assets, location in Travis, Williamson, or Hays County, general attractiveness of the business, and future potential, among other factors. Typically in Central Texas the price will be approximately 2 to 3 times the annual cash flow of the business after recasting, with a 25 to 50 percent down payment and a note paid off over 5 to 10 years. If the business can earn the income you want while servicing the note payments, then it is worth the price.
What is Goodwill?
Goodwill is the difference between the total value of a business and the value of inventory, equipment and other "hard" assets. It includes such features as name recognition, reputation, customer base, and intellectual capital. The amount you should be willing to pay for goodwill depends on the cash flow of the business and its general attractiveness.
What is Discretionary Earnings?
Discretionary earnings are usually defined as profit before income tax, depreciation, interest and owner's compensation and other owner benefits. Discretionary Earnings is the amount of money the owner has available to pay himself, to invest in additional equipment, to make the note payments on the business and pay taxes.
Are there tax benefits in buying a business?
Texas has no state income tax, but usually you can take a Federal tax deduction for depreciation on the fair market value of all furniture, fixtures, and equipment at a much faster rate than real estate. The Covenant Not To Compete and the value of training are tax deductible, frequently at high levels. Finally, most businesses have deductible expenses that add to the owner's cash flow. Always discuss tax issues with a qualified tax professional.
Why not just start my own business?
Government surveys show that over 80% of new businesses fail in the first three years. According to the Texas State Comptrollers Office, twice as many businesses failed in 1997 compared to 1970. Businesses fail for reasons such as poor location, low product quality, under capitalization, and lack of management skills. This risk can be eliminated by purchasing a quality business with a proven cash flow.
Why use a professional business broker to help purchase a business?
When VR Mergers & Acquisitions / VR Business Brokers presents Central Texas business opportunities for your review, it enables you to consider a wider selection of businesses in which you would have an interest and which match your own personal acquisition criteria. Using an intermediary also lets you maintain confidentiality during the initial stages of the buying process. Having a professional to lead you through the steps to buying a business will ultimately give you the peace of mind that your interests were protected and your investment well directed. Look for an individual who has years of experience with Austin businesses, who is professionally trained, who has made a full-time commitment to their career, who has access to the largest data base on comparable business sales in the world and who can be trusted to work for your best interest. If you do, you will choose VR Mergers & Acquisitions / VR Business Brokers to work with you.contact VR Mergers & Acquisitions / VR Business Brokers located in Austin, Texas for more information.
- VR Mergers & Acquisitions / VR Business Brokers located in Austin, Texas will help sell your Austin business by positioning your company in front of qualified buyers.
- VR Mergers & Acquisitions / VR Business Brokers located in Austin will also assist in finding a business to buy if you are looking to purchase a Business in the Austin area.
- We will help you through every step of the process to ensure every aspect of buying or selling your business runs smoothly.
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Our office is owned by
Summit Single Star Business Group, LLC.
11940 Jollyville Road,
Austin, TX 78759
Phone 512 - 340 - 0181
Fax 512 - 340 - 0182
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