So, you own a small business…

What’s it worth?

Your business is one of your biggest assets.

But unlike your TFSAs or RRSPs, there are no quarterly statements showing you what your investment is worth, or how that value has changed over time. You invest your blood, sweat, and tears. You know it must be worth something. But the question is, how much? And why?

That’s where I come in. I help small business owners value their businesses through an analysis called an Opinion of Market Value. An Opinion of Market Value is a detailed, yet efficient (ie. affordable), analysis of a small business, using three accepted approaches to valuation, supported by reputable data sources. So if you are the owner of a Canadian small business (or are looking to buy one), and just want to know a reasonable ballpark of what a business might be worth, then I can likely help.

FAQs

  • An Opinion of Market Value is just that - the professional opinion of someone (me) who has experience selling and valuing small businesses. It is not a formal business valuation, and does not meet the standards of The CBV Institute. However, the formulas and methods used are accepted by the business brokerage and business valuation communities. Although not considered a formal valuation or appraisal, an Opinion of Market Value provides a basis for estimating a reasonable listing/selling price of a business.

    Please Note: An Opinion of Market Value does not include a real estate appraisal, or an appraisal of business assets.

  • The first question everyone asks. My pricing is simple. I charge a flat fee, starting at $2,499 + tax for most small businesses. Exceptions may apply for larger/more complex businesses, but I will let you know in advance if that’s the case. By comparison, most formal valuations at big CPA firms cost north of $10,000. And while these firms generally do great work, their reports are often overkill for what many small business owners want and need.

  • Once I receive ALL of the information required, I will complete a draft of my report for presentation within 7 business days. Then we’ll meet to review, and a final report will be issued shortly thereafter. Ultimately, the biggest timing factor is how long it takes you to gather the required information.

    Please Note: I have limited availability in my schedule, and my engagement calendar fills up quickly.

  • You get a multi-page report, which analyzes your financial results and uses three different approaches to value your business. My report will include market comparable data and/or industry reports, depending on what information is relevant and available for your specific industry. You will also get a 1 hour virtual session where I present my findings, answer any questions that you have, and discuss the key factors that drive my conclusion.

  • Well, that depends on two factors:

    1. The purpose of the valuation. Are you a small business owner planning for retirement, and just trying to figure out what your business might be worth? Preparing for a sale, or a transition of ownership to family and/or management? Then an Opinion of Market Value may be right for you. However, if you are facing a divorce, partnership dispute, CRA issues, and other potentially litigious situations, you likely require a formal valuation.

    2. The size and complexity of your business. Businesses with earnings more than $1 million, multiple divisions, investment holdings, complex tax situations, or significant real estate/fixed asset considerations, may not be appropriate for an Opinion of Market Value.

    If you are unsure if any of this applies to your situation, I am happy to discuss it with you.