Pricing Small Businesses

This course continues the development of important business pricing skills started in Course #220, focusing on those businesses typically sold for under $1 million. We will discuss the Income and Asset Approaches in detail and learn how to reconcile differences between the various Methods including the Direct Market Data Method. Find out how and when to use the Capitalization of Benefits Income Method, Excess Earnings Method, the Multiple of Discretionary Earnings Method and others. Learn how to argue for or against the substance of a third party valuation report. Course #220 is a prerequisite or you must have extensive experience with business valuation. The textbook for Course #220 is also valuable and recommended for this course.

Prerequisite Knowledge

To understand business valuation, you must have a basic knowledge of:

• Recasting financial statements
• The three main approaches to business valuation
• How to provide a Broker’s Opinion of Value (BOV) for a customer

Learning to value a business using either the Income Approach or the Asset Approach requires experience. Most business brokers do not commonly use these approaches. While you will not learn all there is to know today, you will study the basics and gain knowledge of where to find specific information that will help you on the job.