Economy and Business Info
Why is the indicator of corporate value to offer and buy?
The value of the company is an indicator that the vast majority of cases, employers tend to forget and only remember him when they have to sell your company or someone makes them an offer to buy it. However, the value of the company expresses many things and can be used to measure the actions taken in the company, at a given time and their influence on it.
The other myth is that the value of the company is a metric that can only be used by large employers. Quite the contrary, it is a tool that can be used by all employers, regardless of company size and industry in which it operates.
There are many ways to calculate the value of a company from a very simple as multiplying the sales or net income by a multiple, as the most complex, involving the need to make projections for five or 10 years depending on the amount of data that have and how sophisticated the same business area.
The important thing is to be clear that as is necessary to do appraisals for any property that you have, and keep these updated valuations, entrepreneurs, business owners and shareholders must be clear of the value of their companies, at any time, and maintain updated it.
This can be done internally, as a function over the company’s CFO, and / or hire a professional in the field, which can be impartial and objective at the time of the different formulas to measure the value of company.
Before starting any process of valuation, of any size, it is necessary to obtain historical information of the company, so this is the foundation for building the future. Once this historical information is worked, there should be forward-looking building. This historical information should be supplemented with plans for short, medium and long term that the company has, as well as an analysis of the economic situation in the area of influence of the company. Despite the good economic times of the Republic of Panama, is not the same have a Super Mini in Puerto Argüelles, where the local economy is depressed, a mini Super in Chorea, with a growing population, changing and improving economically.
The simpler is the company and its books, the faster will be the projection process, however, if accounting is complicated, the construction of the projections is also complicated, requiring more time for construction.
The important thing in any case, is that your company has accounting, since without it is impossible to make a valuation and will do the accounting necessary first to start the process (and do not think this is unusual, in my years as a consultant Financial, we have found different types of companies whose records do not exist, or leaves much to be desired).
Do not worry if it is a medium or large company, and has no CFO. You may have this function in your company through an outsourcing service, without any trauma, as we understand that for many businesses, having an accounting department or accountant make them meaningful and financially viable, while hire someone in finance represents a strong brew. For this, we provide outsourcing services, which would be the first step for their accounts to another level, and to learn to make strategic decisions with a little more ill give us a higher GDP more healthy and stable.