Whether you run a sandwich bar or a convenience store, selling your business is a potentially stressful time and availing yourself of a free business valuation is often the first step.

There are a myriad of businesses for sale here in the UK and one can easily become overwhelmed with the number of different asking prices for similar businesses. There are many different factors to take into account.

average collections

This is usually expressed weekly for small independent businesses, however when filling in your details on some online business valuation calculators you may be asked for the annual figure.

Lease or property details

It’s easy if you own the property, but you may be involved in a lease where you rent the premises for a set period. You would normally expect brief leasing information when you sell your business. This would normally indicate the remaining duration, the monthly or annual cost, and any special terms or reviews.

unique selling points

A business valuation should take into account any unique selling points. As these are often subjective points, it is normally the area that would not be observed by any online business calculator.

business category

It is important to clarify the type of business for sale, as this often leads valuation methods to make certain assumptions, such as a typical gross profit margin based on annual turnover. This will need to be backed up with audited accounts in full time for any prospective buyer, however this can be a very helpful indication.

ideal buyer

Whether you are selling a business on the open market or privately, it is important to indicate what type of buyer the business would be suitable for. For example, if a business cannot be run as a solo operation, it would be prudent to state that the business would be suitable for a management couple or team.

It is vital that the correct valuation methods are used to value a business, as you need to ensure that it will trade at the correct price. This may differ from the price you expected to receive, either higher or lower, but it’s important to get a fair price for the business you’ve built as an owner.

Whatever your intentions with valuing your business, whether it’s to sell the business or just to satisfy your curiosity, just be patient as the correct figure could lead you to a different decision.