Does Perceived Value of Your Business Equal Reality?

By Tom Cobery
In April 18, 2014

Very often, when owners decide that it is time to sell their business they have a perceived idea as to what the business is worth (or what is needed to meet their financial needs going forward). Unfortunately, however, the real worth of a business is seldom the same as the owners’ perception.

Before making a decision to market your company for sale, you should have an evaluation of its worth in the marketplace done by people who are knowledgeable and can determine a value range. Your outside accountant may not be this person, since he or she is not typically in the business of buying or selling companies.

After you have had an expert determine your company’s value, you should then have discussions with your outside accountant about the tax implications of a sale so you can get a sense of how much you would receive after taxes. Also include your outside valuation advisor in these discussions to help you structure a deal that would be beneficial to you as the seller and have no significant negative impact on the buyer.

Forewarned is forearmed: It is highly unlikely that the money received on the sale of your business will afford you the same lifestyle you are presently enjoying while you are running it. But you will be transferring business risk to the buyer and accepting a more stable investment environment going forward. Hopefully, over time, you will have made outside investments that will help offset any shortfall.

If you want to chat, give me a call at 201-523-6326 or e-mail me at tcobery@napl.org.

Tom Cobery

Dealing with the day-to-day needs of running a busy printing operation often leaves company leaders little time to plan for the future of their enterprises on their own. Tom works with chief executive officers and senior management executives in the Tag and Label Industry to develop growth opportunities through strategic transactions, new markets, or new service opportunities. Available for consulting on individual projects, he can also be engaged to serve as an Advisory Partner, helping executives guide their company into the future, serving as an impartial sounding board for ideas, and working with them to set the right course for continued growth and greater profitability. Tom’s personal experience as a Tag and Label Industry company president and chief executive officer, plus his extensive networking with other industry executives through his volunteer leadership activities with the Tag and Label Manufacturers Institute (TLMI) give him a unique perspective on the tough issues today’s company leaders face in this specialized segment. Companies engaging Tom will find his insight and independent advice an invaluable asset in helping them achieve their growth and profitability goals. More than a consultant, Tom Cobery wants to be your trusted Advisory Partner.

1 Comments

  1. hello , I would like to know what is the multiple (ebitda x ? ) actually used in the market of printing . An average only

    thank you very much

Leave A Comment