HOW THE PROCESS WORKS

We conduct every business valuation as if there was going to be a sale of the subject business at “FAIR MARKET VALUE” as the tax act legislation in Canada and other countries require.
The legal definition of Fair Market Value in Canada, is the highest price, expressed in money, that property would bring in an open and unrestricted market, between a willing buyer and a willing seller who are both knowledgeable, informed, and prudent, and who are acting independently of each other and neither party being under any compulsion to buy or sell.

A 2023 Business Valuation Report using the Eric Jordan “25 Factors Affecting Business” methodology:
A. Identifies
B. Measures
C. Weights
D. Estimates the value to all the tangible and intangible assets in a business.

ACCURACY is not possible without having an actionable plan that could find a buyer for the business you want evaluated.

METHODOLOGY
The Eric Jordan “25 Factors” methodology:
(1) Will show profiles of the most likely buyers of the subject business.
(3) Will show some reasonable plans to reach those profiles identified.
(4) Will show a marketing team who is capable of executing those plans to reach the profiles and at what cost and a time estimate for when a sale should be expected to happen.
(5) Will identify a corporate lawyer who has competent staff, who will not drop the ball and who will push a sale through. That same lawyer should be a tax expert who can advise the client on tax issues regarding the business sale.
(6) Will direct you to fractional employees you can hire to bring this all together.

EXAMPLES BELOW PROVE OUR ACCURACY

2023 - Fees were 3% of total sale:
We have a case in point where, in the valuation process, we determined that the business owner had been a welder prior to opening the subject business. We determined that trenchers, plumbers, or welders would be good buyer targets.

We put the seller in touch with a marketing team we know. The marketing team bought the profiles of the trenchers, plumbers, and welders in the area. The marketing team had an outbound caller making sales calls to these potential buyers. There was other social media advertising put in place.

The client was put in contact with a corporate lawyer, who is also a tax expert, to facilitate the transaction. The business valuation, the marketing and advertising, and the corporate lawyer all total, on a sale of just under a million dollars, was in the range of 3% of the total sale. The buyer was identified in the first week, but it took four months for the deal to close. (The business sold for 100% of the valuation price and yes we can let you talk to the seller)

2023 - Fees 7% range of total sale:
In a second case that was much smaller and a much different type of business, it was a different situation. The business valuation revealed that a Fractional CFO would be required to clean up the financial statements and take the business valuation and make credible projections based on the information the valuation report had uncovered.

The marketing team relied on social media and focused advertising to find the buyer and coordinate between the corporate lawyer, the fractional CFO, the business valuator and the seller. Fees 7% range for everything.

In comparison the real estate agents, business brokers, and merger and acquisition people say they can only sell 25% of businesses they list for sale. (at any price) while charging fees of 10% to 18% without legal fees. And they still charge retainer and monthly fees. Link

Harvard Law Review states that according to most studies, between 70 and 90 percent of Mergers and Acquisitions fail. Link