Up & Coming Weekly

November 28, 2023

Up and Coming Weekly is a weekly publication in Fayetteville, NC and Fort Bragg, NC area offering local news, views, arts, entertainment and community event and business information.

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WWW.UPANDCOMINGWEEKLY.COM November 29 - December 5, 2023 UCW 19 (910) 678-8400 - admissions@faytechcc.edu - w w w.faytechcc.edu Pursue in-person or remote learning oppor tunities - choose from diverse program areas with f lexible options. S e e i t . D e g r e e i t . N o w r e g i s t e r i n g s t u d e n t s f o r S p r i n g 2 0 2 4 c l a s s e s - c l a s s e s b e g i n J a n . 1 6 . When the decision has been made to sell your business, the next step is perhaps the most crucial of all: determining the value of your business. ere are several ways this can be done, but it isn't an exact science. For that reason, it is essential that you seek out a trained broker to help you determine how much your business is worth. But don't expect that broker to tell you every- thing you want to hear. eir job is to be honest and straightforward. is is to help facilitate the easiest and most profitable outcome for you. Sometimes that may mean hearing some hard truths. For instance, you may find that current market condi- tions mean your business isn't worth quite what you thought it would be. It can happen. After all, valuing your business doesn't take in the years of work that you've put into it. No matter what the value of your business turns out to be, an established broker, like the ones at Transworld Business Advisors of Eastern NC, can help you find ways to improve your business to expediate its sale and provide realistic advice and information about how the sale will go. Common valuation approaches What are the most common ways that brokers determine the value of your business? Here are the top approaches: • Comparing similar businesses in your category and focusing on the business's specific industry and how it values companies—a market approach. • Projecting the future earnings of your business and calculating the present value of those earnings or applying a capitalization rate—an income ap- proach • Calculating the business's net asset value—an asset approach • Understanding valuation factors Not everyone is well versed in the language of business evaluation. Understanding some of the basic terminology can help you when you start the process of determining your business's value. To start, tangible assets are assets that have physi- cal substance such as inventory, a building, rolling stock, manufacturing equipment or machinery, and office furniture. e flip side of that, intangible as- sets include patents, copyright, franchises, goodwill, trademarks, and trade names, as well as any form of digital asset such as software, i.e., things that lack physical substance. en there are liabilities. ese are the things your company owes like payments to suppliers, salaries and wages, payroll taxes and loans. e measures of a business's health and performance such as profits, revenue, expenses, or other financial outcomes are the financial metrics. Finally, business owners need to consider that not all trends are specific to profit. From inflation to recession to the availability of capital, the larger macroeconomics can play a role in what your busi- ness will be valued. Benefits of valuing your business Even if you aren't ready to sell, there are many values to knowing the true value of your company. • Helps you plan for retirement and your exit strat- egy of how to leave your business. • Provides time to implement a strategy to im- prove your company prior to exit. • Guides you to the best options if you are seeking additional funding. At Transworld, we have years of experience sell- ing businesses just like yours, and we can provide insight into how to accurately value your business. In fact, we've helped business owners sell more than 15,000 businesses, and we have 250-plus offices worldwide with more than 850 brokers. During our 40 years of experience, we have learned that it can take on average nine months to sell your business, but larger deals may require up to a year. Our Busi- ness Advisors have the training and know-how to help ensure you get the best deal. For a free con- sultation, contact Ashley Kelsey with Transworld Business Advisors of Eastern NC at 910-302-6447 or email akelsey@tworld.com. How business brokers determine worth by ASHLEY KELSEY MONEY ASHLEY KELSEY, Transworld Business Advi- sors of Eastern North Carolina. Comments? Akelsey@tworld.com

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