2016 has highlighted a few trends affecting business valuation. The latest research from the Exit Planning Institute’s 2016 ‘State of Owner Readiness Survey’ reveals that:
1. Business owners are increasingly unprepared for exit
This leaves them unprepared for retirement. In fact, data from HSBC Future of Retirement Report (2015) shows that 45% of business owners (up from 31% in 2010) do not have adequate funds for retirement.
Why does this occur?
2. Business owners are consistently struggling to plan ahead
76% of business owners plan to transition over the next 10 years. Despite this, 66% do not have a formal succession plan in place. This inevitably leads to 4 in 5 businesses unable to sell in the market. If you do not have a clear idea of your end plan, you will never be able to unlock the value which you have built from the ground up as a business owner and truly reap the rewards of your effort.
Understanding business valuation is the first step in maximising value and achieving a successful exit.
For more on business valuation, sign up to CEO Craig West’s webinar on Business Valuation on 6th September 2016.
In this session, Craig West examines various aspects of business valuation including:
- Valuation theory and methodology
- Assessing risk in SME’s
- Cost of Capital – why is this important anyway?
- Reasonableness test
- Valuation case studies
Craig takes you through a practical approach to the critical area of business valuation, as well as how to use the trends above to drive your business value.
