BUSINESS
APPRAISALS
As
an integral part of the first stage of the selling process, valuing
a company is one of the most important issues. It is highly recommended
that sellers obtain a third-party business appraisal from a well-respected
business appraisal company. A business broker / intermediary should
not be the one to appraise the company and they are generally not
sufficiently qualified to do so. Even if they feel that they are
qualified, a broker's own business appraisal can create doubt in
a buyer's mind and, in many cases, can create potential legal liability.
However, the most important issue to understand is that regarding
credibility and believability with potential buyers and lenders.
Credibility
and believability with buyers is an issue when the seller's broker
is the one who has appraised the company. They sometimes see the
interests of the seller being placed in front of their own. Often,
third-party business appraisal companies reduce or eliminate this
issue.
Experienced
and successful professionals in the business brokerage industry
know this is generally the key to maximizing the selling price
of a company, eliminating the largest portion of frustration and
disappointment, and saving all parties involved a great deal of
generally expensive time. While most sellers believe that their
company is worth more than what actual market value is, there are
many instances in which sellers receive less for their companies
than they should. An appraisal from a well-respected, third-party
business appraisal company creates credibility and believability
with buyers and lenders while at the same protecting and maintaining
the seller's interest in his/her company.
If
the seller waits until the buyer appraises the company, then it
is the buyer's best interest to obtain an appraisal on the company
that is as low as possible. Likewise, waiting for the lender to
require an appraisal will only delay the entire process. Therefore,
since an appraisal will probably be performed sometime during the
selling process, it is in the Seller’s best interest to obtain
a business appraisal in the beginning stages, not after the company
is marketed to buyers. Additionally, it is critical that sellers
realize and understand that most lenders and federal loan guarantors,
especially the SBA, require a third-party appraisal.
Austin
Business Brokers uses what many believe to be some of the most
respected business appraisal firms on both a local as well as national
basis. We have established relationships and a history of doing
business with these business appraisal firms and have several optional
plans for our clients who are considering obtaining a business
appraisal. Business Appraisals range in price from $2,500 to over
$20,000. However, they generally average $2,500 to around $5,000
depending on many factors.
We
invite you to contact us for more information regarding business
appraisals by
contacting us.
