BUSINESS EXAMPLE
Business Information
Business Information
Extended Information Enabled
Business Identifier (used in Business Search Result)Example Org.
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Reference |
Looking ForPartner
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Company Start Date2008-09-19
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Financial Year EndSeptember
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SectorRetail
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IndustryOther
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Business DescriptionThis business serves as an example on BusinessPortal-CA and all data added is fictional.
You will not be able to add it to your shortlist or message the business owner and it will not come up in any searches on BusinessPortal-CA.
Some factors in the Human Resources section and in the Valuations are time dependent. This is how they would have appear in April 2016.
One of the existing partners wants to sell 10% of his shares.
Salaries, marketing and other costs need to be increased over the next 5 years to come in line with market costs.
Looking for somebody dynamic with contacts in the industry.
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Registered for GST/HSTYes
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FranchiseNo
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Type of BusinessCorporation
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Current StatusIn Talks
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ProvinceBritish Columbia
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CityVancouver
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Business EnvironmentA fictional office park
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Supplier TypesPaper, Raw Materials for Prodution, Electricity, IT Services, Telecommunications, Courier Services, Catering, Marketing, Accounting, etc.
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Client TypesFinal users of products.
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Legal RegulationMember of a fictional regulatory body.
No pending lawsuits outstanding.
New regulations in the industry may impact sales in the future.
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Asking Price ($)170,000.00
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Annual Turnover ($)3,229,267.00
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Monthly Free Cash Flow ($)1,000.00
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Estimate of Business Value ($)1,040,000.00
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Estimate based onAssets - Liabilities + investment amount at 12% to provide equivalent income to free cash flow.
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SWOT analysis
SWOT analysis
Extended Information Enabled
StrengthsGood name in the industry.
Very secure supply line.
Strong work ethic of employees.
High financial barriers to entry in the industry
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WeaknessesVery reliant on key employees.
Administration is not well organised.
Not ideally placed to serve client base.
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OpportunitiesMoving to more suited premises.
Expanding into new markets.
Finding new clients.
Cutting costs of transport and production.
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ThreatsOne strong competitor with good R & D.
New products in development but unlikely to come to market until 2017.
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Human Resource Information
Human Resource Information
Extended Information Enabled
Board Members
No Board Members entered for this business
Partners
| Partner Type | Time at Company | Highest Education/Certification | Annual Salary | Other Benefits | Other Benefits Explanation | Ownership % | Voting Rights % | Entered as Board Member |
|---|---|---|---|---|---|---|---|---|
| Silent | 62 Months | Honours Degree | $ 0.00 | $ 18,000.00 | Retainer | 10.00% | 0.00% | |
| Active | 62 Months | Masters Degree | $ 108,000.00 | $ 10,800.00 | Car and Phone Allowance | 50.00% | 50.00% | |
| Active | 30 Months | Honours Degree | $ 150,000.00 | $ 0.00 | 30.00% | 30.00% |
Managers
| Manager Type | Alternate Manager Type Description | Time at Company | Highest Education/Certification | Annual Salary | Other Benefits | Other Benefits Explanation | Ownership % | Voting Rights % | Entered as Board Member | Entered as Partner |
|---|---|---|---|---|---|---|---|---|---|---|
| Financial | 15 Months | Associates Degree | $ 60,000.00 | $ 0.00 | 0.00% | 10.00% | ||||
| Sales | 62 Months | Masters Degree | $ 108,000.00 | $ 10,800.00 | Car and Phone Allowance | 50.00% | 50.00% | Yes | ||
| Operations | 30 Months | Bachelors Degree | $ 150,000.00 | $ 0.00 | 30.00% | 30.00% | Yes |
Estimated Annual Increase/Decline (%)0.00
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Estimated Annual Turnover (%)0.00
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Employees
| Employee Type | Alternate Employee Type Description | Job Description | Time at Company | Highest Education/Certification |
Annual Salary | Other Benefits | Other Benefits Explanation | Ownership % | Voting Rights % | Unionised | Entered as Board Member | Entered as Partner | Entered as Manager |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Operations | Logistics and Transportation | 40 Months | Associates Degree | $ 54,000.00 | $ 0.00 | 0.00% | 0.00% | No | |||||
| Operations | Logistics and Transportation | 32 Months | Secondary School | $ 45,000.00 | $ 0.00 | 0.00% | 0.00% | No | |||||
| Custodial | Cleaner | 15 Months | Secondary School | $ 18,000.00 | $ 0.00 | 0.00% | 0.00% | No | |||||
| Sales | Sales Team | 20 Months | Certificate/Diploma | $ 57,000.00 | $ 6,000.00 | Commission | 0.00% | 0.00% | No | ||||
| Administration | Finance and Logistics | 12 Months | Associates Degree | $ 45,000.00 | $ 0.00 | 0.00% | 0.00% | No | |||||
| Sales | Sales Team | 34 Months | Certificate/Diploma | $ 60,000.00 | $ 6,000.00 | Commission | 0.00% | 0.00% | No | ||||
| Multiple | Operations and Administration | Training for Finance, Logistics and Transportation | 6 Months | Secondary School | $ 36,000.00 | $ 0.00 | 0.00% | 0.00% | No | ||||
| Operations | Engineer | 36 Months | Bachelors Degree | $ 108,000.00 | $ 0.00 | 0.00% | 0.00% | No | |||||
| Operations | Engineer | 60 Months | Bachelors Degree | $ 120,000.00 | $ 0.00 | 0.00% | 0.00% | No |
Estimated Annual Increase/Decline (%)0.00
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Estimated Annual Turnover (%)5.00
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Ownership Structure
Ownership Structure
Extended Information Enabled
Ownership Distribution
Private Ownership |
Business Ownership |
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Ownership Distribution Graph
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Voting Weights
Private Voting Weight |
Business Voting Weight |
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Alternative Voting RightOldest Partner has the right to Vito decisions.
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Voting Distribution Graph
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Selling Proposition
Selling Proposition
Extended Information Enabled
Products
| Cost and Price Structure | Comparison to Competing Products – If the Best Competing Product has a Rating of 10 my Product rates at: | Marketing Per Product | ||||||||
| Product Category | Product or Production Cost | Markup | Current Selling Price | Quality | Fit for customer | Affordability | Availability | Being in Customers' Mind |
Marketing Approach | Monthly External Marketing Spend |
| Product Type A | $ 5.00 | 20.00% | $ 6.00 | 9 | 12 | 12 | 6 | 6 | Direct/Targeted | $ 500.00 |
| Product Type B | $ 15.00 | 6.67% | $ 16.00 | 5 | 5 | 13 | 13 | 8 | Media Advertising | $ 3,000.00 |
Services
| Cost and Price Structure | Comparison to Competing Services – If the Best Competing Service has a Rating of 10 my Service rates at: | Marketing Per Service | ||||||||
| Service Classes | Cost/hour to produce service | Markup | Average Billing price | Alternative Service Pricing | Customer tailoring | Affordability | Timeousness | Being in Customers' Mind |
Marketing Approach | Monthly External Marketing Spend |
| Rent Cottage on Property | $ 0.00 | 0.00% | $ 0.00 | 1200/Month | 10 | 10 | 10 | 10 | Word of Mouth | $ 0.00 |
| Service Type A | $ 25.00 | 60.00% | $ 40.00 | 10 | 10 | 10 | 10 | Business to Business | $ 0.00 | |
| Service Type B | $ 15.00 | 200.00% | $ 45.00 | 15 | 8 | 15 | 15 | Business to Business | $ 0.00 | |
| Service Type C | $ 5.00 | 200.00% | $ 15.00 | Plus km driven at $0.50/km | 10 | 10 | 8 | 8 | Business to Business | $ 0.00 |
Business Processes
Business Processes
Extended Information Enabled
Products
| Purchasing of Products, Part-Products (requiring assembly) or Raw Materials for the production of Products | Product or Production Cost (Estimate % of Spend towards Product Manufacturing/Purchase Price pre Sale for…) | Sales | |||||||||||||||
| Product Category | Product Type | Payment terms | Alternative Description | Delivery terms | Purchasing | Labour | Transport | Services | Storage of raw materials/part products | Storage of final Product | Commission % paid on Sales | Variable Commission paid | Rules for Variable Commission | Customer Payment Terms | Alternative Description | Delivery Terms | Sales Effort towards Product |
| Product Type A | Final Product | 90 days | 14 days | 70.00% | 5.00% | 15.00% | 0.00% | 0.00% | 10.00% | 5.00% | No | 30 days | 7 days | 35.00% | |||
| Product Type B | Part Product (requires assembly) | 90 days | 30 days | 45.00% | 30.00% | 5.00% | 5.00% | 8.00% | 8.00% | 5.00% | No | 30 days | 14 days | 65.00% | |||
Services
| Cost/Hour to produce Service (Estimate % of Service Production Spend per Service) | Sales | ||||||||||
| Service Classes | Labour | Licence Fees | Services | Consumables | Commission % paid on Sales | Variable Commission paid | Rules for Variable Commission | Customer Payment Terms | Alternative Description | Delivery Terms | Sales Effort towards Service |
| Service Type A | 80.00% | 10.00% | 5.00% | 5.00% | 0.00% | No | 30 days | Delivery before payment | 0.00% | ||
| Service Type B | 60.00% | 20.00% | 0.00% | 20.00% | 0.00% | No | 30 days | Delivery before payment | 0.00% | ||
| Service Type C | 35.00% | 0.00% | 5.00% | 60.00% | 0.00% | No | 7 days | 1 day | 0.00% | ||
| Rent Cottage on Property | 0.00% | 0.00% | 50.00% | 50.00% | 0.00% | No | 30 days | Delivery before payment | 0.00% | ||
Assets
Assets
Extended Information Enabled
Income Generating (necessary for production) Assets
Raw Materials
| Description | Purchase Date | Purchase Price | Selling Price (on purchase date) |
| Raw Materials for Product Type B | 2014-09-03 | $ 100,000.00 | $ 80,000.00 |
Stock on hand
| Amount of stock available for sale |
| $ 250,000.00 |
Equipment
| Description | Purchase Date | Purchase Price | Selling Price (on purchase date) |
| Truck | 2010-08-19 | $ 36,000.00 | $ 24,000.00 |
| Truck | 2013-07-19 | $ 45,000.00 | $ 40,000.00 |
| Computers | 2012-05-11 | $ 4,000.00 | $ 3,000.00 |
Property (if rented out)
No Property (if rented out) added
Business Interests
| Description | Stake | Purchase Date | Purchase Price | Selling Price (if sold today) |
| Swapped for 10% stake in Example Org. | 20.00% | 2015-08-19 | $ 0.00 | $ 0.00 |
Loans Given or Negative Balance in Loan Account
| Description | Amount | Repayment Condition | Interest Rate | Monthly Repayment |
| Outside Party | $ 36,000.00 | Loan to Partners Family | 7.00% | $ 1,600.00 |
Non-Income Generating Assets
Property (if not rented out)
| Description | Purchase Date | Purchase Price | Selling Price (if sold today) |
| Business Property | 2010-02-25 | $ 360,000.00 | $ 450,000.00 |
Other Non-income generating Assets
No Other Non-income generating Assets added
Liabilities
Liabilities
Extended Information Enabled
Outstanding Invoices owed to Suppliers for Raw Materials, Stock and/or Consumables and Other Monthly Costs
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Less than 7 days late ($)4,000.00
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Between 7 and 14 days late ($)0.00
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Between 14 and 30 days late ($)0.00
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Between 30 and 60 days late ($)0.00
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More than 60 days late ($)0.00
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Not to be paid ($)1,600.00
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Reason for non-paymentDefective stock that wasn't retrieved.
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As at:2014-01-01
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Outstanding Debts on Assets
| Asset Class | Outstanding Amount | Remaining Term | Monthly Repayment | Interest Rate | Repayments Up To Date | Months Overdue |
| Property (if not rented out) | $ 160,000.00 | 84 Months | $ 5,000.00 | 4.34% | Yes | 0 Months |
| Motor Vehicles | $ 16,000.00 | 24 Months | $ 500.00 | 6.35% | Yes | 0 Months |
Outstanding Loans or Positive Balance in Loan Account
| Loan Type | Outstanding Amount | Repayment Conditions | Interest Rate | Monthly Repayment |
| Partners | $ 50,000.00 | Interest paid only | 12.00% | $ 500.00 |
Other Outstanding Loans
| Loan Name | Outstanding Amount | Repayment Conditions | Interest Rate | Monthly Repayment |
| Starting Capital | $ 30,000.00 | Interest paid only | 12.00% | $ 300.00 |
Outstanding Salaries
No Outstanding Salaries added
Unsellable Stock
| Outstanding Amount |
| $ 12,000.00 |
Other Monthly Costs
No Other Monthly Costs added
Financial Information
Financial Information
Extended Information Enabled
Account Information
| Account Type | Balance | Interest Rate (+ve Balance) |
Interest Rate (-ve Balance) |
Overdraft/Credit/ Access Bond/ Savings Available Funds |
| Cheque | $ 35,000.00 | 0.05% | 14.00% | $ 100,000.00 |
| Cheque | $ -10,000.00 | 0.05% | 9.95% | $ 40,000.00 |
| Credit | $ 3,000.00 | 3.00% | 14.55% | $ 5,000.00 |
| Property Loan | $ -160,000.00 | 0.00% | 4.34% | $ 40,000.00 |
Income Recovery Rate
Estimate % of Payments
On or before
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Less than 7 days late9.00
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Between 7 and
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Between 14 and 30 days late0.00
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Between 30 and 60 days late3.80
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More than 60
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Income Recovery Graph
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Current Expected Income
Total Due ($)120,000.00
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Total Overdue ($)16,000.00
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Invoicing
Invoicing
Extended Information Enabled
Products
| Forecast Annual Invoicing Amounts | Forecast Monthly Invoicing Amounts for Next Year | Historical Monthly Invoicing Amounts for Last Year | Historical Annual Invoicing Amounts | |||||||||||||||||||||||||||||
| Product Category | Year 5 | Year 4 | Year 3 | Year 2 | Month 12 | Month 11 | Month 10 | Month 9 | Month 8 | Month 7 | Month 6 | Month 5 | Month 4 | Month 3 | Month 2 | Month 1 | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | Year 2 | Year 3 | Year 4 | Year 5 |
| Product Type A | $ 954,000.00 | $ 945,200.00 | $ 747,000.00 | $ 657,000.00 | $ 68,800.00 | $ 66,800.00 | $ 76,700.00 | $ 65,600.00 | $ 59,000.00 | $ 65,600.00 | $ 84,500.00 | $ 68,400.00 | $ 60,100.00 | $ 95,900.00 | $ 40,500.00 | $ 41,500.00 | $ 62,500.00 | $ 71,500.00 | $ 61,500.00 | $ 55,500.00 | $ 78,500.00 | $ 64,000.00 | $ 52,500.00 | $ 76,000.00 | $ 56,500.00 | $ 89,000.00 | $ 39,000.00 | $ 39,500.00 | $ 812,500.00 | $ 744,500.00 | $ 660,000.00 | $ 800,000.00 |
| Product Type B | $ 3,000,000.00 | $ 2,800,000.00 | $ 2,600,000.00 | $ 2,500,000.00 | $ 190,000.00 | $ 190,000.00 | $ 190,000.00 | $ 190,000.00 | $ 190,000.00 | $ 190,000.00 | $ 190,000.00 | $ 190,000.00 | $ 190,000.00 | $ 190,000.00 | $ 190,000.00 | $ 190,000.00 | $ 195,000.00 | $ 172,500.00 | $ 172,500.00 | $ 217,500.00 | $ 187,500.00 | $ 184,500.00 | $ 213,000.00 | $ 213,000.00 | $ 213,000.00 | $ 109,500.00 | $ 109,500.00 | $ 157,500.00 | $ 2,400,000.00 | $ 2,400,000.00 | $ 2,175,000.00 | $ 1,980,000.00 |
| Totals | $ 3,954,000.00 | $ 3,745,200.00 | $ 3,347,000.00 | $ 3,157,000.00 | $ 256,800.00 | $ 256,800.00 | $ 266,700.00 | $ 255,600.00 | $ 249,000.00 | $ 255,600.00 | $ 274,500.00 | $ 258,400.00 | $ 250,100.00 | $ 285,900.00 | $ 230,500.00 | $ 231,500.00 | $ 257,500.00 | $ 244,000.00 | $ 234,000.00 | $ 273,000.00 | $ 266,000.00 | $ 248,500.00 | $ 265,500.00 | $ 289,000.00 | $ 269,500.00 | $ 198,500.00 | $ 148,500.00 | $ 197,000.00 | $ 3,212,500.00 | $ 3,144,500.00 | $ 2,835,000.00 | $ 2,780,000.00 |
Services
| Forecast Annual Invoicing Amounts | Forecast Monthly Invoicing Amounts for Next Year | Historical Monthly Invoicing Amounts for Last Year | Historical Annual Invoicing Amounts | |||||||||||||||||||||||||||||
| Service Classes | Year 5 | Year 4 | Year 3 | Year 2 | Month 12 | Month 11 | Month 10 | Month 9 | Month 8 | Month 7 | Month 6 | Month 5 | Month 4 | Month 3 | Month 2 | Month 1 | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | Year 2 | Year 3 | Year 4 | Year 5 |
| Rent Cottage on Property | $ 22,840.00 | $ 20,763.60 | $ 18,876.00 | $ 17,160.00 | $ 1,300.00 | $ 1,300.00 | $ 1,300.00 | $ 1,300.00 | $ 1,300.00 | $ 1,300.00 | $ 1,300.00 | $ 1,300.00 | $ 1,300.00 | $ 1,300.00 | $ 1,300.00 | $ 1,300.00 | $ 1,200.00 | $ 1,200.00 | $ 1,200.00 | $ 1,200.00 | $ 1,200.00 | $ 1,200.00 | $ 1,100.00 | $ 1,100.00 | $ 1,100.00 | $ 1,100.00 | $ 1,100.00 | $ 1,100.00 | $ 12,600.00 | $ 11,600.00 | $ 9,000.00 | $ 8,500.00 |
| Service Type A | $ 160,000.00 | $ 140,000.00 | $ 120,000.00 | $ 100,000.00 | $ 7,500.00 | $ 7,500.00 | $ 7,500.00 | $ 7,500.00 | $ 7,500.00 | $ 7,500.00 | $ 7,500.00 | $ 7,500.00 | $ 7,500.00 | $ 7,500.00 | $ 7,500.00 | $ 7,500.00 | $ 7,500.00 | $ 8,300.00 | $ 6,700.00 | $ 5,000.00 | $ 13,300.00 | $ 8,300.00 | $ 7,500.00 | $ 8,300.00 | $ 4,200.00 | $ 10,000.00 | $ 5,800.00 | $ 4,200.00 | $ 83,300.00 | $ 72,000.00 | $ 42,000.00 | $ 33,000.00 |
| Service Type B | $ 170,000.00 | $ 160,000.00 | $ 140,000.00 | $ 120,000.00 | $ 10,000.00 | $ 10,000.00 | $ 10,000.00 | $ 10,000.00 | $ 10,000.00 | $ 10,000.00 | $ 10,000.00 | $ 10,000.00 | $ 10,000.00 | $ 10,000.00 | $ 10,000.00 | $ 10,000.00 | $ 10,000.00 | $ 10,000.00 | $ 7,000.00 | $ 16,000.00 | $ 0.00 | $ 5,000.00 | $ 9,000.00 | $ 9,000.00 | $ 14,000.00 | $ 8,000.00 | $ 12,000.00 | $ 6,400.00 | $ 110,000.00 | $ 78,000.00 | $ 68,000.00 | $ 48,000.00 |
| Service Type C | $ 190,000.00 | $ 170,000.00 | $ 160,000.00 | $ 150,000.00 | $ 12,000.00 | $ 12,000.00 | $ 12,000.00 | $ 12,000.00 | $ 12,000.00 | $ 12,000.00 | $ 12,000.00 | $ 12,000.00 | $ 12,000.00 | $ 12,000.00 | $ 12,000.00 | $ 12,000.00 | $ 10,800.00 | $ 9,000.00 | $ 14,600.00 | $ 10,000.00 | $ 10,000.00 | $ 12,200.00 | $ 12,800.00 | $ 9,600.00 | $ 9,800.00 | $ 7,000.00 | $ 5,000.00 | $ 5,400.00 | $ 128,400.00 | $ 125,000.00 | $ 85,000.00 | $ 77,800.00 |
| Totals | $ 542,840.00 | $ 490,763.60 | $ 438,876.00 | $ 387,160.00 | $ 30,800.00 | $ 30,800.00 | $ 30,800.00 | $ 30,800.00 | $ 30,800.00 | $ 30,800.00 | $ 30,800.00 | $ 30,800.00 | $ 30,800.00 | $ 30,800.00 | $ 30,800.00 | $ 30,800.00 | $ 29,500.00 | $ 28,500.00 | $ 29,500.00 | $ 32,200.00 | $ 24,500.00 | $ 26,700.00 | $ 30,400.00 | $ 28,000.00 | $ 29,100.00 | $ 26,100.00 | $ 23,900.00 | $ 17,100.00 | $ 334,300.00 | $ 286,600.00 | $ 204,000.00 | $ 167,300.00 |
Gallery
Gallery
Extended Information Enabled
Documents
Documents
Extended Information Enabled
No Documents Added
Asset Replacement and Running Costs Valuation
Business Valuation
All Information Available to Business Editors Only
General Comments on Business Valuations
Business Valuations are based on the information added into the Information Sheets and populate as the information is added. If the information is incomplete or inaccurate, it will affect the accuracy of the valuation. These valuations will state assumptions and calculations as far as possible to help you see where the value of your business could be improved. Hover your cursor over or click on table headings with a shaded corner for more information.
Note that, even though these valuations are based on this businesses "management account" information entered, the valuation approach may not be appropriate to the type of business being valued. The final value of a business is the price at which a willing seller will agree with a willing buyer. These valuations act as an informative guide for the range of this businesses value.
This valuation is for 100% of the businesses shares.
For more background information on the valuation principles and assumptions as well as their relevance to this business, please refer to my blog, Business Valuation: A "How to" guide.
Note that, even though these valuations are based on this businesses "management account" information entered, the valuation approach may not be appropriate to the type of business being valued. The final value of a business is the price at which a willing seller will agree with a willing buyer. These valuations act as an informative guide for the range of this businesses value.
This valuation is for 100% of the businesses shares.
For more background information on the valuation principles and assumptions as well as their relevance to this business, please refer to my blog, Business Valuation: A "How to" guide.
Asset Replacement and Running Costs Valuation
The Asset Replacement and Running Costs Valuation is based on the value starting an equivalent company with comparable assets (bought at new prices) and a cash buffer to cover running costs for a given period. It thus represents the absolute maximum an investor should be willing to pay for a business before the option to set up a new one becomes more attractive.
This valuation can be suitable for all kinds of businesses depending on the buffer period for chosen costs. Service industries, which are not asset dependent, might have to work in a higher buffer to cover "Salaries". The buffers for "Marketing Costs", "Costs of Production", "Commission on Sales" and "Extra Monthly Liabilities" should resemble the time taken to bring products to market and develop a stable customer base. Note that this valuation does not take intangible assets (goodwill) into account. Note also that investors might pay more (per share) to buy a portion of a company if financial constraints do not allow them to set up an entire new one.
This valuation can be suitable for all kinds of businesses depending on the buffer period for chosen costs. Service industries, which are not asset dependent, might have to work in a higher buffer to cover "Salaries". The buffers for "Marketing Costs", "Costs of Production", "Commission on Sales" and "Extra Monthly Liabilities" should resemble the time taken to bring products to market and develop a stable customer base. Note that this valuation does not take intangible assets (goodwill) into account. Note also that investors might pay more (per share) to buy a portion of a company if financial constraints do not allow them to set up an entire new one.
| Asset Replacement Costs |
| Cumulative Price per Asset Class Inflated Monthly from Purchase Date by Annual Inflation Rate of... | |||||
| Asset Class | ...0% (Purchase Price) | ...1% | ...2% | ...3% | ...4% |
| Raw Materials | $ 100,000.00 | $ 102,615.89 | $ 105,297.94 | $ 108,044.77 | $ 110,867.04 |
| Stock on Hand (at cost price) |
$ 250,000.00 | $ 250,000.00 | $ 250,000.00 | $ 250,000.00 | $ 250,000.00 |
| Equipment | $ 85,000.00 | $ 88,438.16 | $ 92,030.80 | $ 95,785.44 | $ 99,709.96 |
| Property (if rented out) | $ - | $ - | $ - | $ - | $ - |
| Business Interests | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 |
| Loans Given or -ve Balance in Loan Account (outstanding amount) |
$ 23,194.09 | $ 23,194.09 | $ 23,194.09 | $ 23,194.09 | $ 23,194.09 |
| Property (if not rented out) | $ 360,000.00 | $ 382,570.15 | $ 406,534.74 | $ 431,979.70 | $ 458,991.96 |
| Other Non-income generating Assets | $ - | $ - | $ - | $ - | $ - |
| Total Replacement Asset Value | $ 818,194.09 | $ 846,818.29 | $ 877,057.56 | $ 909,006.00 | $ 942,763.05 |
| Monthly Costs |
| Cumulative Costs per Cost Class for... | |||||
| Cost Class | ...1 Month | ...2 Months | ...3 Months | ...6 Months | ...1 Year |
| Board Members Salary & Benefits |
$ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 |
| Partners Salary & Benefits |
$ 23,900.00 | $ 47,800.00 | $ 71,700.00 | $ 143,400.00 | $ 286,800.00 |
| Managers Salary & Benefits |
$ 5,000.00 | $ 10,000.00 | $ 15,000.00 | $ 30,000.00 | $ 60,000.00 |
| Employees Salary & Benefits |
$ 46,250.00 | $ 92,500.00 | $ 138,750.00 | $ 277,500.00 | $ 555,000.00 |
| Total Salaries | $ 75,150.00 | $ 150,300.00 | $ 225,450.00 | $ 450,900.00 | $ 901,800.00 |
| Marketing Costs | $ 3,500.00 | $ 7,000.00 | $ 10,500.00 | $ 21,000.00 | $ 42,000.00 |
| Cost of Production | $ 181,768.75 | $ 363,537.50 | $ 545,306.25 | $ 1,090,612.50 | $ 2,181,225.00 |
| Commission on Sales | $ 127,975.00 | $ 255,950.00 | $ 383,925.00 | $ 767,850.00 | $ 153,570.00 |
| Liabilities Other Monthly Costs |
$ - | $ - | $ - | $ - | $ - |
| Cumulative Costs |
| Asset Value Inflation Rate |
2%
▼ |
$ 877,057.56 |
| Months of Salaries Cover |
3
▼ |
$ 225,450.00 |
| Months of Marketing Costs Cover |
6
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$ 21,000.00 |
| Months of Cost of Production Cover |
2
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$ 363,537.50 |
| Months of Commission on Sales Cover |
1
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$ 12,797.50 |
| Months of Extra Liabilities Cover |
1
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$ - |
| Asset Replacement and Running Costs Valuation Total | $ 1,499,842.56 | |
Current Asset Value minus Liabilities
Business Valuation
All Information Available to Business Editors Only
General Comments on Business Valuations
Business Valuations are based on the information added into the Information Sheets and populate as the information is added. If the information is incomplete or inaccurate, it will affect the accuracy of the valuation. These valuations will state assumptions and calculations as far as possible to help you see where the value of your business could be improved. Hover your cursor over or click on table headings with a shaded corner for more information.
Note that, even though these valuations are based on this businesses "management account" information entered, the valuation approach may not be appropriate to the type of business being valued. The final value of a business is the price at which a willing seller will agree with a willing buyer. These valuations act as an informative guide for the range of this businesses value.
This valuation is for 100% of the businesses shares.
For more background information on the valuation principles and assumptions as well as their relevance to this business, please refer to my blog, Business Valuation: A "How to" guide.
Note that, even though these valuations are based on this businesses "management account" information entered, the valuation approach may not be appropriate to the type of business being valued. The final value of a business is the price at which a willing seller will agree with a willing buyer. These valuations act as an informative guide for the range of this businesses value.
This valuation is for 100% of the businesses shares.
For more background information on the valuation principles and assumptions as well as their relevance to this business, please refer to my blog, Business Valuation: A "How to" guide.
Current Asset Value minus Liabilities Valuation
The Current Asset Value minus Liabilities Valuation is based on value of assets in the company once all liabilities have been excluded. It thus represents the absolute minimum a seller should be willing to sell a business for.
This valuation is only suitable for insolvent businesses which are being bought for their assets. If the company has a turnover and is (or has the potential to be) profitable, its valuation should be higher than the Current Asset Value minus Liabilities Valuation to compensate. The smaller the turnover (or profit) in comparison to this valuation, the closer the company value will be to the Current Asset Value minus Liabilities Valuation. Note that this valuation does not take intangible assets (goodwill) into account.
This valuation is only suitable for insolvent businesses which are being bought for their assets. If the company has a turnover and is (or has the potential to be) profitable, its valuation should be higher than the Current Asset Value minus Liabilities Valuation to compensate. The smaller the turnover (or profit) in comparison to this valuation, the closer the company value will be to the Current Asset Value minus Liabilities Valuation. Note that this valuation does not take intangible assets (goodwill) into account.
| Current Asset Values |
| Cumulative Value per Asset Class Depreciated Annually from Purchase Date by Annual Depreciation Rate of... | |||||
| Asset Class | ...0% (Non-Depreciating) | ...5% | ...10% | ...25% | ...50% |
| Raw Materials | $ 80,000.00 | $ 72,200.00 | $ 64,800.00 | $ 45,000.00 | $ 20,000.00 |
| Equipment | $ 67,000.00 | $ 57,242.87 | $ 48,758.76 | $ 29,460.94 | $ 11,125.00 |
| Other Non-income generating Assets | $ - | $ - | $ - | $ - | $ - |
| Asset Class | Cumulative Value per Asset Class at entered Sales Price | ||||
| Property (if rented out) |
$ - | ||||
| Business Interests | $ 0.00 | ||||
| Property (if not rented out) |
$ 450,000.00 | ||||
| Total | $ 450,000.00 | ||||
| Asset Class | Cumulative Value per Asset Class at entered Asset Price or at outstanding amount | ||||
| Stock on Hand (at cost price) |
$ 250,000.00 | ||||
| Loans Given or -ve Balance in Loan Account (outstanding amount) |
$ 23,194.09 | ||||
| Current Expected Income as at 2013-10-15 | $ 120,000.00 | ||||
| Total | $ 393,194.09 | ||||
| Financial information as at 2016-01-25 |
| Cumulative Account Balance | $ 28,000.00 | ||||
| Liabilities |
| Liability Class | Long-term Liabilities | ||||
| Outstanding Invoices as at 2014-01-01 | $ 43,400.00 | ||||
| Outstanding Debts on Assets as at 2014-06-23 (outstanding amount) |
$ 74,190.09 | ||||
| Outstanding Loans or +ve Balance in Loan Accounts as at 2013-10-03 (outstanding amount) |
$ 50,000.00 | ||||
| Other Outstanding Loans as at 2014-06-24 (outstanding amount) |
$ 30,000.00 | ||||
| Outstanding Salaries as at 2016-02-05 (outstanding amount) |
$ - | ||||
| Unsellable Stock as at 2014-06-25 (outstanding amount) |
$ 12,000.00 | ||||
| Total | $ 209,590.09 | ||||
| Liability Class | Current Liabilities (Monthly Costs for 1 month) | ||||
| Board Members Salary & Benefits |
$ 0.00 | ||||
| Partners Salary & Benefits |
$ 23,900.00 | ||||
| Managers Salary & Benefits |
$ 5,000.00 | ||||
| Employees Salary & Benefits |
$ 46,250.00 | ||||
| Total Salaries | $ 75,150.00 | ||||
| Marketing Costs | $ 3,500.00 | ||||
| Cost of Production | $ 181,768.75 | ||||
| Commission on Sales | $ 12,797.50 | ||||
| Liabilities Other Monthly Costs |
$ - | ||||
| Cumulative Assets and Account Balance minus Liabilities |
| Raw Materials |
5%
▼ |
$ 72,200.00 | Equipment |
10%
▼ |
$ 48,758.76 | Other Non-income generating Assets |
Choose a Depreciation Rate
▼ |
$ - |
| Assets at Sales Price |
Include
▼ |
$ 450,000.00 |
| Assets at Asset Price or at outstanding amount |
Include
▼ |
$ 393,194.09 |
| Cumulative Account Balance |
Exclude
▼ |
$ - |
| Long-term Liabilities |
Include
▼ |
-$ 209,590.09 |
| Total Salaries |
Include
▼ |
-$ 75,150.00 |
| Marketing Costs |
Include
▼ |
-$ 3,500.00 |
| Costs of Production |
Include
▼ |
-$ 181,768.75 |
| Commission on Sales |
Include
▼ |
-$ 12,797.50 |
| Liabilties - Other Monthly Costs |
Include
▼ |
-$ - |
| Current Asset Value minus Liabilities Valuation Total | $ 481,346.51 | |
Discounted Cash Flow Valuation
Business Valuation
All Information Available to Business Editors Only
General Comments on Business Valuations
Business Valuations are based on the information added into the Information Sheets and populate as the information is added. If the information is incomplete or inaccurate, it will affect the accuracy of the valuation. These valuations will state assumptions and calculations as far as possible to help you see where the value of your business could be improved. Hover your cursor over or click on table headings with a shaded corner for more information.
Note that, even though these valuations are based on this businesses "management account" information entered, the valuation approach may not be appropriate to the type of business being valued. The final value of a business is the price at which a willing seller will agree with a willing buyer. These valuations act as an informative guide for the range of this businesses value.
This valuation is for 100% of the businesses shares.
For more background information on the valuation principles and assumptions as well as their relevance to this business, please refer to my blog, Business Valuation: A "How to" guide.
Note that, even though these valuations are based on this businesses "management account" information entered, the valuation approach may not be appropriate to the type of business being valued. The final value of a business is the price at which a willing seller will agree with a willing buyer. These valuations act as an informative guide for the range of this businesses value.
This valuation is for 100% of the businesses shares.
For more background information on the valuation principles and assumptions as well as their relevance to this business, please refer to my blog, Business Valuation: A "How to" guide.
Discounted Cash Flow Valuation
The Discounted Cash Flow Valuation is based on the amount of income a business is assumed to be able to generate in the future. It is based on forecasts of the growth of company earnings and costs and then converts the resultant Free Cash Flow to a present value by one of two methods:
* Summing the present values of the Free Cash Flow with a Terminal Value based on company growth that is assumed to eventually be lower than inflation. This assumption comes about because mature companies earnings should approach inflation when their market is saturated.
* Calculating an equivalent investment amount that would yield the same returns as the final year (assuming stability) of forecast results. The interest rate of this equivalent investment is an indication of the risk this business represents at that stage and should be higher than inflation.
This valuation is suitable for all businesses. It does, however, rely heavily on assumptions about the business, market and future and some factors are highly sensitive to the valuation.
* Summing the present values of the Free Cash Flow with a Terminal Value based on company growth that is assumed to eventually be lower than inflation. This assumption comes about because mature companies earnings should approach inflation when their market is saturated.
* Calculating an equivalent investment amount that would yield the same returns as the final year (assuming stability) of forecast results. The interest rate of this equivalent investment is an indication of the risk this business represents at that stage and should be higher than inflation.
This valuation is suitable for all businesses. It does, however, rely heavily on assumptions about the business, market and future and some factors are highly sensitive to the valuation.
| Cash Flow Forecast Assumptions |
| Salaries Annual Inflation Rate |
8%
▼ |
|
| Marketing Annual Inflation Rate |
10%
▼ |
|
| Other Monthly Costs Annual Inflation Rate |
6.5%
▼ |
|
| Effective Company Tax Rate |
25%
▼ |
|
| Inflation Rate to discount Operating Cash Flow |
6.5%
▼ |
|
| Assumed Growth of Operating Cash Flow after Year 5 |
2%
▼ |
|
| Equivalent Risk Interest Rate |
10%
▼ |
| Forecast |
Year 5 ($) |
Year 4 ($) |
Year 3 ($) |
Year 2 ($) |
Year 1 ($) |
|
| Extra Income |
0.00
|
0.00
|
0.00
|
0.00
|
0.00
|
|
| Extra Costs |
35,000.00
|
30,000.00
|
25,000.00
|
20,000.00
|
15,000.00
|
| Cashflow Forecast |
| Forecast Annual | Historical Annual | |||||
| Income Category | Year 5 | Year 4 | Year 3 | Year 2 | Year 1 | Year 1 |
| Total Entered Product Invoices | $ 3,946,092.00 | $ 3,737,709.60 | $ 3,340,306.00 | $ 3,150,686.00 | $ 3,065,257.20 | $ 2,885,218.00 |
| Product Invoices Growth | 5.58 % | 11.90 % | 6.02 % | 2.79 % | 6.24 % | |
| Total Entered Service Invoices | $ 541,754.32 | $ 489,782.07 | $ 437,998.25 | $ 386,385.68 | $ 368,860.80 | $ 324,849.00 |
| Service Invoices Growth | 10.61 % | 11.82 % | 13.36 % | 4.75 % | 13.55 % | |
| Loans Given or Negative Balance in Loan Account | $ 0.00 | $ 0.00 | $ 0.00 | $ 5,105.14 | $ 19,200.00 | $ 19,200.00 |
| Extra Income | $ - | $ - | $ - | $ - | $ - | |
| Total Income | $ 4,487,846.32 | $ 4,227,491.67 | $ 3,778,304.25 | $ 3,542,176.82 | $ 3,453,318.00 | $ 3,229,267.00 |
| Forecast Annual | Historical Annual | |||||
| Cost Category | Year 5 | Year 4 | Year 3 | Year 2 | Year 1 | Year 1 |
| Product Cost of Production | $ 2,724,000.00 | $ 2,585,783.33 | $ 2,297,625.00 | $ 2,160,750.00 | $ 2,122,775.00 | $ 1,998,239.58 |
| Service Cost of Production | $ 83,833.33 | $ 75,666.67 | $ 68,333.33 | $ 61,000.00 | $ 58,450.00 | $ 50,500.83 |
| Board Members Salary & Benefits |
$ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 | $ - |
| Partners Salary & Benefits |
$ 421,403.29 | $ 390,188.23 | $ 361,285.40 | $ 334,523.52 | $ 309,744.00 | $ 286,800.00 |
| Managers Salary & Benefits |
$ 88,159.69 | $ 81,629.34 | $ 75,582.72 | $ 69,984.00 | $ 64,800.00 | $ 60,000.00 |
| Employees Salary & Benefits |
$ 815,477.08 | $ 755,071.37 | $ 699,140.16 | $ 647,352.00 | $ 599,400.00 | $ 555,000.00 |
| Total Salaries | $ 1,325,040.06 | $ 1,226,888.94 | $ 1,136,008.28 | $ 1,051,859.52 | $ 973,944.00 | $ 901,800.00 |
| Marketing Costs | $ 67,641.42 | $ 61,492.20 | $ 55,902.00 | $ 50,820.00 | $ 46,200.00 | $ 42,000.00 |
| Commission on Sales | $ 197,700.00 | $ 187,260.00 | $ 167,350.00 | $ 157,850.00 | $ 153,570.00 | $ 144,550.00 |
| Outstanding Debts on Assets | $ 0.00 | $ 0.00 | $ 0.00 | $ 6,425.87 | $ 66,000.00 | $ 66,000.00 |
| Outstanding Loans or +ve Balance in Loan Account | $ 6,000.00 | $ 6,000.00 | $ 6,000.00 | $ 6,000.00 | $ 6,000.00 | $ 6,000.00 |
| Other Outstanding Loans | $ 3,600.00 | $ 3,600.00 | $ 3,600.00 | $ 3,600.00 | $ 3,600.00 | $ 3,600.00 |
| Liabilities Outstanding Salaries |
$ - | $ - | $ - | $ - | $ - | $ - |
| Liabilities Other Monthly Costs |
$ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 |
| Extra Costs | $ 35,000.00 | $ 30,000.00 | $ 25,000.00 | $ 20,000.00 | $ 15,000.00 | |
| Total Cost | $ 4,442,814.81 | $ 4,176,691.14 | $ 3,759,818.62 | $ 3,522,930.69 | $ 3,445,539.00 | $ 3,212,690.42 |
| Forecast Annual | Historical Annual | |||||
| Summary | Year 5 | Year 4 | Year 3 | Year 2 | Year 1 | Year 1 |
| Total Income | $ 4,487,846.32 | $ 4,227,491.67 | $ 3,778,304.25 | $ 3,542,176.82 | $ 3,453,318.00 | $ 3,229,267.00 |
| Total Cost | -$ 4,442,814.81 | -$ 4,176,691.14 | -$ 3,759,818.62 | -$ 3,522,930.69 | -$ 3,445,539.00 | -$ 3,212,690.42 |
| Total Income - Total Cost | $ 45,031.51 | $ 50,800.53 | $ 18,485.63 | $ 19,246.13 | $ 7,779.00 | $ 16,576.58 |
| Tax | -$ 11,257.88 | -$ 12,700.13 | -$ 4,621.41 | -$ 4,811.53 | -$ 1,944.75 | -$ 4,144.15 |
| Operating Free Cash Flow | $ 33,773.63 | $ 38,100.40 | $ 13,864.23 | $ 14,434.59 | $ 5,834.25 | $ 12,432.44 |
| Operating Free Cash Flow Growth | -11.36 % | 174.81 % | -3.95 % | 147.41 % | -53.07 % | |
| Discounted Operating Free Cash Flow (Current Value) | $ 24,650.73 | $ 29,616.32 | $ 11,477.49 | $ 12,726.39 | $ 5,478.17 | $ 12,432.44 |
| By Summing Discounted Operating Free Cash Flows | By Equivalent investment to yield year 5 Forecast Operating Free Cash Flow | ||
| Year 1 | $ 5,478.17 | ||
| Year 2 | $ 12,726.39 | ||
| Year 3 | $ 11,477.49 | ||
| Year 4 | $ 29,616.32 | ||
| Year 5 | $ 24,650.73 | ||
| Terminal Value | $ 799,309.25 | ||
| Discounted Cash Flow Valuation Total | $ 883,258.34 | $ 949,578.96 |
