Succession For Business Group | Business Development | Small Business | Succession Planning | Melbourne | Warrnambool

On Friday night I attended a business awards gala. For those businesses entering his award, they were required as part of the application process to completed an extensive questionnaire involving nearly all aspects of the individual businesses.  The businesses where then questioned by the judging panel about their business, with the winners of each category determined based on their responses.

In congratulating the winners and other businesses for being nominated, I began to ask about the process  business entrant went through.  They all mentioned how exhaustive the questions were on all aspects of their business.

I asked each of the winners if they knew how much their business was worth.  Of the 15 business who won awards, only one knew the value of their business – I found this staggering!  Here was the cream of the crop and only one out of 15 could tell me what the business was worth!

In all cases, I am sure that all business owners were planning on using their business to assist in funding their retirement, yet they had not idea how much it was worth?

During the GFC nearly every person with investments could tell you how much they had lost on their investments.  These same people could tell you how much their investments have recovered.  They know the value of their investments.  All investments except their business!

People have an expectation of what money they would like to have when they retire.  To achieve this goal it is imperative that the business is valued regularly.  An investment has a unit price or share price so you can regularly track how they are going and make changes where necessary.  A business has a value that can be changed by adjusting aspects of your business.  How do you know your business is truly improving if you do not know the value?

For further information on how best to determine your business value, please contact us.