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FAQ’s About Key Person Consideration

Virtually every business has centralized management and/or relies on the talents of a few individuals. This risk of centralized management is taken into account for business valuation purposes in the company’s future earnings or rate of return (i.e., discount rate). In some cases, however, one person is the linchpin, and if he or she leaves… Continue >>>

The Bank Is Requesting The Fair Market And Liquidation Value Of Our Assets To Be Used As Collateral For A Loan. Can Your Construction Equipment Appraisal Experts Help?

Loan officers often ask for a certified construction equipment appraisal or truck equipment appraisal for verification of asset values when submitting to underwriters. American Business Appraisers offers heavy equipment valuation to banks and businesses including construction equipment appraisal, heavy machinery appraisal, truck equipment appraisals, farm equipment appraisals, and more. Our heavy equipment appraisers are among… Continue >>>

Looking Beyond Cash Flow to Build Company Value

A value-minded owner should search for ways to lower the company’s perceived risks to potential buyers or investors by: Creating a formal business plan. Forecasts and projections facilitate due diligence and demonstrate management depth. But buyers might critique a seller’s business plan and modify them with their own assumptions. Budgeted and actual results should be… Continue >>>

Are The Business Valuation Specialists Employed By American Business Appraisers Certified Appraisers?

Our Arizona business valuation analysts hold several designations in the business appraisal and equipment appraisal fields. As a certified appraiser, we offer valuation services including business valuation, equipment appraisal, and estate and gift tax services. Our Arizona business appraisal experts perform valuations nationwide. Learn more about our appraisal services by calling American Business Appraisers at… Continue >>>

Importance of Business Valuations before Retirement

Most business owners know that planning for retirement is crucial. However, according to Entrepreneur magazine, very few business owners are aware of the true value they have. Many have not taken the necessary steps to receive an accurate business valuation well before considering retiring. This makes it somewhat difficult to ensure they receive adequate value… Continue >>>

Three Key Factors in Business Valuation

The three key factors are profitability, growth and risk. Profitability, or more specifically, anticipated benefits will be the most important consideration by investors (i. e., buyers). Anticipated benefits will consider such items as the nature, capital structure, and historical performance. Growth considerations are generally the expected growth in earnings, along with the anticipated outlook for… Continue >>>

Three Aspects of a Business Valuation Professional

This is a good time to reflect on three important and misunderstood aspects of the role of the valuation professional: The valuation professional. The nature of the finding. How are the findings used. Role of the Professional: Valuation professionals may act as either an “appraiser” or “consultant” – but not both in a single engagement.… Continue >>>

Benchmarking (adding value)

Assessing risk is a crucial part of valuing a closely-held business. Business appraisers use risk assessments in the income approach to estimate rates of return (discount rates) and in the market approach to select valuation multiples. All else being equal, the higher a company’s risk, the lower its value, conversely lower risk (value drivers) increases… Continue >>>

Common Questions regarding Business Valuation

What is the process to complete a business valuation? Valuing a privately held business is not an exact science. To do it accurately requires experience and the ability to examine all the risk factors and value drivers involved. A business valuation typically takes three to five weeks to complete, depending on the size and scope… Continue >>>

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