Evaluation or Valuation?
I am often asked to evaluate a business when what is really wanted is to value a business. What is wanted is to know is what the business is worth. To determine the value of a business is a valuation. It takes skill and a variety of input as described in an earlier post to do a professional valuation. It is easy to understand the confusion because I have even seen broker advertise business evaluation as a service. An evaluation is a simple assessment of how your business is doing, which doesn't take a professional. Your customers do it for you every day. Their reaction to your product and services will give you a good idea of what you are doing right and what you can improve upon. While these evaluations are free, they are valuable. They will determine if your business will grow and succeed, which is the reason we are all in business. Of course, a successful and profitable business will have more value than another when it comes time to do a valuation.
Larry Steinborn, Broker
Business Depot
239-43-1343
www.twitter.com/bizdepot
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