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What's the Business Worth?
Edward Jacobson: It's amazing, how many people come to me and they said what is my business worth. They have no idea.
Eliot Wagonheim: There are several ways to find out. One is to work with an experience business broker or depending upon the size and industry, an investment banker. These will have a feel for what a business is worth.
Edward Jacobson: Not knowing what this is the worth is the biggest question about that, that any prospective buyer has or even any seller has.
Eliot Wagonheim: If for example, you are purchasing a business that is in a different industry. An industry with which perhaps you not as familiar. It maybe a good idea to get a business evaluation.
Fred Provorny: And also get some idea from outside experts, as to what its prospects are.
Eliot Wagonheim: In simplistic terms, the business is worth what it can generate in earnings.
Fred Provorny: You really need to get, in effect, into the bowels of the company and see what makes it tick.
Eliot Wagonheim: Some businesses is well run through personal expenses. Some businesses will either overpay the owner or underpay the owner.
Fred Provorny: In the words of the late President Reagan, "Trust, but verify".
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