Factors That Change Your Valuation Result

Remember, if you don’t get the result you wanted today, you can get a different one later if factors align favorably.

Markets Are Consistently Shifting

Today’s markets are constantly changing and shifting, which can result in the value of your business fluctuating as well. 2020 alone completely turned the global economy. New trends became established, and entire industries suffered huge losses.

That’s why using a market-based approach can offer you some real insight into how much your business is worth today rather than using outdated values to overestimate the worth of your net assets. Economic expansion, natural disasters, pandemics, political unrest, and other factors out of your control are all part and parcel of being a business owner — just wait them out.

New Service or Product Launch

If you’ve noticed a huge change in your earnings or even your tangible asset value with a new valuation result, make sure you check the timeline for the change. A new service or product launch may have caused these changes.

While you may think that a new product or service would increase your net value, there are some cases in which it could be pulling your company’s value down. In that case, having a detailed valuation can help you make smarter business decisions in the future.

Expansion of Locations and Sites

Your valuation can also change as you expand the land-based assets you have. How does this work? Well, land has its own value, which is negotiated via the real estate market. You’ll also be spending money buying equipment or completing construction projects on the land in question, which can add more value to it.

Another way that a land-based expansion can alter your valuation is if your product potential increases, which affects the intangible aspect of business worth.

New High-Value Clients or Their Loss

When you gain new clients that are contributing a huge amount to your earnings, or lose them, your business’s value will rise or fall accordingly. How does this work? For service-oriented businesses, especially B2B ones, clients are part of their worth. The loss or addition of high-value clients increases or decreases their value.

However, there are always methods to perform your company’s valuation that offers an accurate representation of its worth. That’s why our company valuation platform gives you the option of using any startup valuation method you’d like.

Take a look at our online valuation tool and what it offers today.