By searching for information to increase your odds of creating a successful business transition/exit for you, your family, your company, and your employees, you position your business to become better than the 80% of small businesses in today’s market.
One of the first things I learned when we initiated our transition plan to sell our family business, Lakefront Lines, was the importance of knowing our EBITDA and Free Cash Flow numbers.
Today, I advise business owners to understand the importance of Free Cash Flow and the EBITDA numbers for their business. Armed with this information, an owner can easily estimate the market-based/sale value of their business.
Free Tip: Once you have identified your Free Cash Flow from your Income Statement, multiply it by 4 (an average sale multiple.) The sum will provide you with a rough number that demonstrates the estimated market-based/sale value for your business.
Does this estimate coincide with your expectations of how the market is valuing your company or what a potential buyer may be willing to pay for your business?
If not, let’s connect for a coffee to discuss how EBITDA & Free Cash Flow can be used to eliminate your Value Gap.
Schedule a Meeting with Chris Today!
Let’s see if together we can eliminate your Value Gap!
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