The current small business credit crunch is getting much attention and rightly so We know very little about the overall small business universe because it is so huge and diverse

There are 3 approaches to valuing a business – market, income and asset A thorough business valuation requires that you consider methods from all approaches

There are 3 approaches to valuing a company – market, income and asset This article covers the asset- based approach

There are 3 approaches to valuing a business – market, income and asset This article covers the income approach

There are 3 approaches to valuing a business – market, income and asset This article covers the market approach

The earning capacity of a company is the primary driver of its value Cash flow is the preferred measure of earning capacity for valuation purposes because it represents a purer form of earnings

The basic concept of business value is that the future benefits (return) of owning a company must be adjusted (discounted) for the risks associated with owning the company The sales or earnings of a company are typically used to represent the benefits (return)

The basic concept of business value is that the future benefits (returns) of owning a company must be adjusted (discounted) for the risks associated with owning the company The sales or earnings of a company are typically used to represent the benefits (returns)

A valuation is based on a hypothetical sale of the company, so two critical issues need to be well defined from the beginning – 1) exactly what is being sold (valued), and 2) who is the most likely buyer What is Being Valued

As a business owner, you know more about your business than any one, but there is one thing you are not too sure about - how much it is worth This is the first in a series of articles designed to help you learn about business valuation and, if you choose, do your own business valuation