Archive for July, 2013

If you are like many business people you probably use a number of computers in your work. For example, you may have a PC workstation in the office and a Mac laptop or iPad tablet at home.

Sometimes you may find it convenient to continue a project at home that you started in the office. If you are working on valuing a business this would mean sharing your work in progress across the Windows and Mac computers.

With ValuAdder this task is a snap. You can have a Mac version of ValuAdder at home and a Windows software in the office. Anytime you want to you can save all your work as a project scenario file. The same format works on both OS X and Windows. So you can send the scenario file to your home office, for example using your network connection or email.

One you are ready, just double click on the file name on your Mac. ValuAdder comes up with the scenario data open. You can continue your business valuation analysis right where you left off. Of course, the work you do at home can be shared back with your computer in the office.

Incidentally, the ValuAdder tour you can see online shows the Windows version of the software. All the features are identical for both the Mac OS X and Windows products. However, the Mac version of ValuAdder looks and acts like a Mac application and behaves in the familiar way you expect of any professional OS X software.

If you take a look at ValuAdder software online tour, you will notice that the Market Comps tool covers 425 industry sectors. That means that ValuAdder has comparative business sales data across all these sectors. They cover all major industries including:

  • Business and personal services
  • Retail
  • Wholesale and distribution
  • Food and drink industry
  • Automotive
  • Manufacturing and technology companies
  • Financial sector
  • Professional services
  • And many others

You are not limited to these 425 industry sectors when using ValuAdder to value a business. This is because ValuAdder features a number of well known methods from each of the major valuation approaches:

  • Market – based on comparison with recent business sales
  • Income – based on your company’s earning power
  • Asset – based on the firm’s assets

You can select the method you want to use by just a mouse click in ValuAdder. You can easily customize ValuAdder by choosing the methods for your valuation. Click on the Learn More button as you create a method to see how it works and how you can use it.

The income and asset valuation methods, such as the discounted cash flow or capitalized excess earnings, help you determine your business value by focusing on your company rather than doing comparisons to other firms. Asset and income methods analyze your company directly regardless of your industry sector.

This is good news in situations where comparative business sales are not enough to rely on for your business appraisal. There are industries where business sales do not take place often. Moreover, your business may be unique and hard to compare to other firms in any established sector.

In such cases you can forgo the market approach and use just the income and asset methods available to you. In your business appraisal report you may want to indicate that you do not believe that the market comparison is appropriate in your particular situation.

Remember that the choice of methods is up to you. You do not need to confine your analysis to any one of them. What is important is to select a set of methods that helps you determine you business value as accurately and convincingly as possible.

If you are new to business valuation the new concepts and terminology may be confusing at first. Even for business people familiar with the financial information such as income statements and balance sheets, the language of business appraisal takes a little getting used to.

The typical questions you may have are:

  • What is business valuation?
  • Why are there so many methods to value a company?
  • Which methods are best for my particular business?
  • What does this term mean?
  • How do I create and report a business valuation?

ValuAdder helps you get a firm grasp of the fundamentals and then quickly progress to being able to create accurate and defensible business valuations. A big part of this is the ValuAdder Learning and Information Center that is integrated into the software.

The Center serves as a comprehensive help system and a reference resource as you do your work. Click on the Overview link on the Start screen and you are immediately taken to an orientation section for your ValuAdder software system.

From there it is just a click to get to the business valuation guide for an idea of what business appraisal is all about. Next, you can review the various approaches to valuing a company and the actual calculation methods you can use.

How can a particular method help you? Take a look at the Tutorial, each method in ValuAdder has one. See what assumptions and inputs are needed for the method and how it works in the context of a typical business valuation. Once familiar with a method, you can create a tool in ValuAdder and perform the calculation.

Keep that Learning and Info Center window open. As a handy reference, consider using the How-to sections on each method as a quick reminder. In addition, many typical business valuation situations are described in the best practices section. What do business people look for in valuation of specific types of companies? How is business valuation for divorce different from a business sale? You can find answers for your own company valuation.

See an unfamiliar term? Search in the Glossary included with your Center. Each term you are likely to encounter in your valuation is defined and explained, along with examples of its use in a typical business appraisal.

It is a good idea to keep the Learning and Info Center open as you do your analysis. The Center window is always there and you can get help with a mouse click. If you can’t see the answer right away, use the search function to look for answers.