VR Mergers & Acquisitions / VR Business Brokers located in Austin, Texas

Why Business Valuation?

Though every client of VR Mergers & Acquistions / VR Business Brokers in Austin receives a free estimate of the value of their Central Texas business, many businesses require a more formal business appraisal. VR Mergers & Acquisitions (VR M&A) has established relationships with accredited firms whose valuations are accepted by 95% of all SBA lenders in the country. Using third party valuations make the purchase price a small part of negotiations. Once both buyer and seller receive an objective appraisal of the value of the business, they can focus on other terms & conditions of the transaction. VR sells 86% of all businesses that agree to a third party independent valuation.

The business valuation (sometimes referred to as a business appraisal) can be used for many other reasons as well.

The top five reasons to obtain a business valuation are:

1. Partner Dispute / Divorce / Litigation
2. Obtaining Financing
3. Preparation For Sale of Business
4. Gift Tax / Estate Tax Planning
5. Periodic Assessment of Marketplace

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How Do We Establish the Value of Texas Area Businesses?

A business is ultimately worth what the market will bear - it is worth the highest price a willing buyer is willing to pay! Although VR Mergers & Acquisitions employs many valuation methodologies, four methods are most widely accepted in Texas and throughout the United States:

1. multiple of earnings / cash flow
2. comparable transactions analysis
3. asset-based valuation
4. discounted cash flow analysis

Valuation experts, aware of the strengths and weaknesses of each approach, will value a company using more than one of the methodologies, comparing results from several methods simultaneously to determine a correct valuation. Included in the process is an analysis of risks, growth potential, industry factors, the Texas business market, and other variables that may impact the value of a business opportunity.

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How Do We Get Started in the Business Valuation Process?

All businesses are different. Some businesses keep details books and records - others may not. We can work with any situation. However, to get started in arranging a formal business appraisal, VR Mergers & Acquisitions usually requires:

1. Signed engagement letter.
2. A check for 50% of the agreed-upon fee.
3. Three years of business tax returns or profit-and-loss statements.
4. Current year-to-date profit-and-loss statement.
5. Current balance sheet.
6. Approximate value of furniture, fixtures, equipment, and inventory

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How Long Does It Take to Determine the Value of My Business?

Limited Scope Business Valuations, which are often used for obtaining lender financing, preparation for sale of the business, or conducting periodic analysis of the marketplace, can typically be completed within 5-10 business days.
Full Business Appraisals, , which are typically required for any form of tax planning or litigation, will require 2-3 weeks to complete.

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What is the Cost of a Business Appraisal?

The cost of the business valuation varies with many factors including purpose (whether for internal or external purposes, acquisition or litigation), business size, type of corporate identity, years in business, whether the business has clean books, etc. The average fee for Limited Scope Valuations is $1,500 - $2,500. The average fee for Full Scope Based Valuations is $3,500 - $5,000.

You will find VR M&A'S prices to be much less than most sources!