What Every Business Owner Should Know About Valuing Their Business [Paperback]

Stanley J. Feldman (Author), Timothy G. Sullivan (Author), Roger M. Winsby (Author)

Book Description

Publication Date: November 25, 2002

The first easy-to-follow valuation handbook for business owners of every size Accurate valuation of a business is generally complex to determine and costly to obtain.

What Every Business Owner Should Know About Valuing Their Business provides business owners with the knowledge they need to obtain and understand a valuation and ensure they receive what they're paying for.

Explanations include valuation basics, situations in which a valuation should be performed, what it should cost, and much more.

Numerous case studies illustrate valuations for a wide variety of industries, variables, and situations. Practical valuation-related issues are given in-depth yet easy-to-understand coverage, including:

• What owners should and should not do during a valuation
• Pros and cons of various methods for buying or selling a business
• Legal and accounting aspects essential to fair valuation

Editorial Reviews

From the Back Cover

Packed with money-saving advice for business owners

The First Practical Guide to Business Valuation Written for Owners

Most small business owners will at some point need a business valuation; and despite its importance to their financial future, few understand how these numbers are determined.

In What Every Business Owner Should Know about Valuing Their Business, a team of valuation experts provides a plain-English explanation of what a valuation is, the primary valuation methods, and what owners can do to make sure that they are getting the right answers--presented in realistic case studies. These cases include valuable "lessons learned" drawn from the experiences of hundreds of business owners.

This book levels the playing field for owners in dealing with potential buyers, business brokers, valuation consultants, or the IRS. When your business is your most valuable asset, it pays to be prepared!

Praise from a leading small business advocate:

"A practical primer for small business owners who want to get the most for
their business when they are ready to sell."--Jack Faris, CEO, National Federation of Independent Business

Praise from experienced entrepreneurs:

"A must read for any owner of a private business--read it sooner rather than later. This book will save you time, money, and headaches."--Daniel O'Sullivan, CEO, Excelcion, Inc.

"This readable book takes the mystery out of business valuation for owners. It will make you an expert in how to manage a valuation of your business."--Joel Kutovsky, Owner, Kahn Associates

About the Author

Stan Feldman, Ph.D. is an associate professor of finance at Bentley College and chairman of the valuation firm bizownerHQ.

Tim Sullivan, Ph.D. is a professor of finance at Bentley College.

Roger Winsby is the president of bizownerHQ, a strategic partner of the National Federation of Independent Business (NFIB) and the preferred provider of business valuation services for its members.

Product Details

• Paperback: 272 pages
• Publisher: McGraw-Hill; 1 edition (November 25, 2002)
• Language: English
• ISBN-10: 0071409920
• ISBN-13: 978-0071409926
• Product Dimensions: 8.6 x 6.6 x 0.6 inches
• Shipping Weight: 12 ounces (View shipping rates and policies)
• Average Customer Review: 4.2 out of 5 stars  See all reviews (12 customer reviews)
• Amazon Best Sellers Rank: #1,246,522 in Books (See Top 100 in Books)

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Customer Reviews

Most Helpful Customer Reviews

8 of 8 people found the following review helpful:

5.0 out of 5 stars Very useful information for the small business owner!, April 29, 2003

By A Customer

This review is from: What Every Business Owner Should Know About Valuing Their Business (Paperback)

I found this book to be logical and informative about many matters that I've had trouble getting good information about. We small business people may often find ourselves going it alone, wandering about in the wilderness, so to speak.

This book offers education and guidance about matters very relevant to the management of one's business in order to make it more profitable and ultimately more valuable at the time of sale. The ramifications of various decisions about what to include as tax deductible necessities are spelled out. I recognized how many times my desire to minimize my taxes had driven my decisions rather than looking at the larger picture--my need for an adequate retirement income. This is an even bigger issue for someone who hopes to ultimately sell their business to fund their retirement than for me as a professional practitioner.

I especially liked the fact that the authors explained the various methods of business valuation and their underlying assumptions. They spelled out the pros and cons of each so that they could be selected for appropriateness as well as weighted if they were all combined to provide a ballpark figure.

The examples were detailed, varied, and interesting. They seemed very realistic. They were effective at illustrating various points the authors wished to make. While this book is targeted more to owners and sellers, it would be very beneficial for any potential business buyers to read. It makes clear many areas to be probed so that there are not unpleasant surprises later on.

... The book is quite inexpensive and the valuation service, although it sounds expensive at ... is inexpensive and fast compared to any other alternatives. The ways in which the information the valuation process yields can be used are amply demonstrated in the various examples. The authors are also available for consultation as part of the package and there are options to tailor services to meet a specific legal need.

This book has the potential to save a business owner a tremendous amount of money if he or she plans to maximize the value of their business for 3-5 years prior to a projected sale, rather than manage their business in their usual way. It's a great resource to help business owners (and/or their families)prepare for transitions! Buy it and read it if you are a small business owner now or are considering becoming one!

8 of 8 people found the following review helpful:

5.0 out of 5 stars Fantastic $... Value!, January 30, 2003

By 

Joel J. (San Francisco, CA USA) - See all my reviews

This review is from: What Every Business Owner Should Know About Valuing Their Business (Paperback)

This book about valuing one's business - in my case, an S Corporation; essentially, however a partnership - is worth far more than its cost - exponentially more.

In the few short hours it took me to read it initially, I came to view new angles about our company that I'd not even considered before. As we studied the work further, both my partner and I developed a clearer understanding of how others may evaluate the level of our business success when we reach the point of wanting to sell the company. And, there are real life ideas spread throughout the book that will aid us in valuing the business when that time comes, as well as helping direct us to the kinds of buyers to whom the business would be worth more than to others in the general community.

Several real life-like examples of companies going through the process of being valued, sold and bought were eye-openers, too. We have a more clear understanding of the fact that valuation done by several different firms or accountants will usually yield several different sets of valuation numbers. Now we also know how we might interpret these results. The authors, too, explained in some detail how we could increase our firm's (or anyones' firms) real and perceived value as we ready to transition ourselves to retirement when we sell. Seeing the different results yielded by "value maximization strategies" versus "tax minimization" ones have led us to begin revising part of the fundamental foundation upon which our business has rested the last 15 years.

When the time comes for us to obtain updated business valuations for our firm, we now know where we can go for good information - bizownerHQ - and see how we can effectively use that information when the time comes to act on it.

Finally, I should note that the book isn't completely "dry" as some might expect. Stories of companies undergoing valuation, in the process of being bought and sold, were in some cases amusing and entertaining, probably because the stories describe processes all of us who own businesses have been through on many occasions ourselves! An enjoyable read on top of the big information value make this a terrific buy for any small business owner.

7 of 7 people found the following review helpful:

5.0 out of 5 stars Helpful and Informative, March 26, 2003

By A Customer

This review is from: What Every Business Owner Should Know About Valuing Their Business (Paperback)

I just picked up a copy of this book because I needed to know the value of a family business. I thought I could just pick a formula and presto that would be the number. After reading this book, and going over the case studies, I now know differently. There is a lot more involved than randomly assigning a value to your company. And this book showed me how. Its straight forward approach and readability will now let me see what I need to do in order to maximize the value of the company. Thanks for the tips!