Many business owners will admit that they do not know the current value of their business. Worse yet, those who claim to know the value will grossly overestimate or underestimate the value of their business, with serious repercussions.
Understanding the value of one’s business is critical.
I have worked with business owners and their professional advisors (e.g. accountants, lawyers, etc.) for many years on matters involving business valuation. I am often called when there is an immediate need to determine the value of a business or security – which could be in the context of an actual transaction, a legal dispute, a corporate reorganization or a matrimonial separation.
It became apparent to me that a business valuation can be a very powerful planning tool for business owners. Despite the tremendous benefits, I find that obtaining an independent business valuation is still a largely undiscovered planning tool among business owners.
I started this blog a few years ago with the intention of disseminating valuable information to the business and legal communities regarding various topics related to business valuation, including the use of a business valuation as a planning tool.
Getting an independent business valuation done now provides the shareholders with a valuation template for future updates. It also provides the basis for shareholders to discuss major assumptions underlying the value conclusions and key drivers effecting value.
An independent business valuation is something that should be done before it needs to be done and is extremely useful for a number of reasons.
• It helps manage value expectations.
• It helps enhance business value.
• It helps avoid legal disputes.
• It is integral for exit planning.
• It is required for tax and estate planning.
• It is vital for contingency planning.
I elaborate on each of these throughout The Undiscovered Planning Tool for Business Owners. I will also share some experiences involving business owners who have successfully incorporated an independent business valuation into their planning as well as actual situations illustrating the consequences of not including an independent business valuation into the planning process. Finally, I address some of the common reasons why business owners avoid exit planning and how these barriers can be broken down.
If any of this resonates with you, my hope is that you are motivated to be more proactive, positive and successful when it comes to setting and achieving your goals.
For more information or to pre-order your copy today www.undiscoveredplanningtool.ca