BUSINESS EVALUATION
- Business evaluation
Business evaluation is the estimation of business’s value or the economic benefits which business brings by using suitable evaluation methods.
In other words, business evaluation is the process of evaluating or estimating the market value of the rights and benefits got by business ownership for business owners.
Currently, there are many different evaluation methods such as asset method, comparison method, discounted cash flow method and combination method. The selection of evaluation methods should be based on the features of the production and business operations of the enterprise as well as the particular features of each evaluation method.
- When need to evaluate business?
For businesses, business evaluation helps business owners knowing how much is the business’s market value if they offer to sell their businesses. Currently, businesses often pay attention to the business evaluation in the following cases:
- Purchase, sale, merger, joint venture, business liquidation
- Investment, capital contribution, buying and selling securities of businesses
- Equitization and listing of stocks on the securities market
- Loan capital for business investment
- Solve and handle the conflicts
- Who are care of business evaluation?
Currently, beside business owners, investors have been concerning on business evaluation before making investment decisions.
For investors, the business evaluation supports investors offering the lowest purchase price compared with estimated price by this scientific finance method. In other words, the business evaluation supports the investors to estimate approximate accuracy of forward income if they buy enterprises at this time.
