Wednesday, January 14, 2015
Florida Business for Sale: Understanding the Real Value of a Business
Buying a Florida business for sale is not unlike making any other business investment, and just like any other investments, Buyers are seeking a reasonable rate of return on their money. If you have ever watched ABC’s hit television show “Shark Tank” you will find “the sharks” especially Kevin O’Leary, aka Mr. Wonderful, are constantly challenging entrepreneurs about the values they put on their businesses. Mr. O’Leary recognizes that business value needs to be based on historical earnings and any future potential does not translate into value, but only creates a business opportunity worth investing if the price is right.
Florida Business Brokers run into these same kinds of situations every day. Brokers understand if a
Market conditions can have some impact on business value. “The Sharks” on “Shark Tank” often have some experience in a particular market and can usually draw from that, as well as other business experiences, to evaluate the marketability of a given product or service. In the same way Florida Business Brokers can draw conclusions on the marketability of a Florida Business for Sale by looking at the market trends and conditions of that market. The conclusions when examining market conditions are usually straight forward. Flat, declining, saturated or obsolete markets usually make for less desirable opportunities. Business opportunities that have been proven and growing always seem to be the most appealing and thus warrant the higher business values. Opportunities with huge upside potential tend to be riskier as they have often not been proven, although knowledgeable investors may still find the best gems among the undercapitalized opportunities.
Whether you are just a fan of ABC’s hit televison show “Shark Tank” or an entrepreneur looking to Buy or Sell a Florida Business for Sale, understanding business value and the differences between the Buyer’s and Seller’s points of view is a key factor to what it takes to put a business deal together. If you are looking to Buy or Sell a business in Florida contact a Florida Business Broker at 239-284-1317. To learn more about Business Valuations check out www.TruforteBusinessGroup.com.