Whether you plan to buy a business or sell a business that you already own, understanding how to value a business is key. You don’t want to overpay for a business you’re acquiring. As an owner, you don’t want to miss out on value owed for a business you’re selling.

In this article, I’ll summarize the five primary ways to value a business.

5 Common Business Valuation Methods

Important to business owners – there are also multiple ways to increase the value of a business. Some of the factors that impact the value of the business are consistent regardless of the valuation type. Other factors depend on the type of valuation performed. That’s a topic for another day, but keep it in mind as you start to consider