The Science of Valuation: Key Factors That Influence Business Valuations in San Diego
At the time of selling a business, it is important to determine the fair market value at all times. However, this is impacted by numerous factors. They include both qualitative and quantitative factors. Let’s take a quick look at some of the most prominent factors that impact business valuations San Diego . Revenue and Cash Flow Among the most fundamental valuation factors for a San Diego small business is current and historical revenue, along with seller discretionary cash flow. The recurring income a company generates and the portion of profits that owners can extract for discretionary purposes directly impact value. Higher revenues and cash flow relative to similar market comparables will lift valuations. Factors like revenue volatility and growth trends also influence worth. Hard Assets For companies with significant tangible assets like commercial real estate, equipment, intellectual property, and inventory, understanding the equity value of these holdings is critical. Appra...