Five things that can affect the value of your business

By Brad Kirkpatrick

Brad Kirkpatrick

There are five dismal Ds that can affect your business:

– death
– divorce
– disability
– disagreement
– departure

But a regularly updated estimate of value (EOV) can limit conflict when the D’s hit.

A current EOV protects against value disputes during a divorce, disagreement with a partner, or an early retirement (departure). I’ve seen businesses stuck in limbo when two conflicted partners couldn’t agree on value. The company couldn’t be sold and the partners couldn’t buy each other out as long as their expectations were so far apart.

I’ve also testified in a court case when a widow disputed the buy-out value offered by a surviving partner. Value disputes are messy, expensive and sad. Get an independent (and inexpensive) EOV every few years, and know what your business is truly worth.

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Brad has been providing M&A advisory services and other consulting services since 2005 and has facilitated numerous ownership transactions. In 2013, he merged his M&A practice with Cornerstone Business Services.