Rules of thumb. Most industries have one of more rules or thumb. However, they can vary widely and in most cases do not give an accurate value of a business. The business valuator will be able to decide what is the most relevant information about a business and then make an informed decision about its value. The value of a business valuator.
Business valuation is as much an art as a science.
While the business valuator does employ standardized formulas and methods to calculate value, he works from assumptions that are based on his experience in the market place and his familiarity with the similar businesses. This process includes the selection of the most appropriate risk and return variables. In this way, his applied expertise leads to the best calculations of value for a specific business.