Maxell Consulting conduct workshop maintaining business values
One of the strategy options for business owners is to exit the business and relax on the Gold Coast. There is enough value being added to justify the investment.
The value of business is governed by three key factors: future cash flow, rate of return and risk. The importance of cash flow makes sense. The more money a business generates, the more a buyer is prepared to pay for it.
The rate of return for a business is related to the attractiveness of the investment. It is the profit a business makes divided by the investment in the business. It is the same as getting a higher interest rate on savings deposits.
Rate of return is also associated with the risk of the business but in reverse. Risk refers to the uncertainty of future cash flows. The more uncertain the future of the business is, the less confidence a buyer will have in getting the money back. So the higher the risk of a business, the less a buyer will pay.
Maxell Consulting is conducting a free workshop on how to run a business effectively and the role of cash flows in the future. It will show attendees how to work out an indicative value of their business and what things can be done to increase its value.
5-Sep-2008