As an integral part of the first stage of the selling process, establishing the value of a business is one of the most important issues. It is highly recommended that sellers obtain a third-party appraisal from a well-respected appraisal company. A broker/intermediary should not be the one to appraise the business and they are generally not sufficiently qualified to do so. Even if they feel that they are qualified, a broker's own appraisal can create doubt in a buyer's mind and, in many cases, can create potential legal liability. However, the most important issue to understand is that regarding credibility and believability. Buyers often have a problem with the seller's broker being the one who has appraised the business. They see the interests of the seller being placed in front of their own. Third party appraisal companies often eliminate this issue.

Experienced and successful professionals in the brokerage of businesses know this is generally the key to maximizing the sale price, eliminating the largest portion of frustration and disappointment, and saving all parties involved a great deal of generally expensive time. While most sellers believe that their business is worth more than what actual market value is, there are many instances in which they receive less for their business than they should. An appraisal from a well-respected, third-party appraisal company creates credibility and believability with buyers and lenders while at the same protecting and maintaining the seller's interest in his/her business.

In the US, many lenders and federal loan guarantors (i.e. the SBA) require an appraisal. It is critical that sellers realize this and understand the importance of a seller-obtained, third-party appraisal.

If the seller waits until the buyer has the business appraised, then it is the buyer's best interest to have it appraised as low as possible. Likewise, waiting for the lender to require an appraisal will only delay the entire process. Therefore, since an appraisal will likely be performed sometime during the selling process, it is in the interest of the seller to obtain an appraisal in the beginning stages, not after the company is marketed to buyers.

On the other hand...

If you are a potential buyer, your interests are the exact opposite of the seller. It is clearly in your best interests to obtain the business appraisal rather than the seller obtaining it.

As anyone might expect, this has been, currently is, and probably will continue to be item of growing concern in buy/sell transactions. Feel free to contact us for further discussion of this issue.

We use what many believe to be some of the most respected appraisal firms both locally and nationally and are approved appraisers for most lenders. Because of our established relationships and history of doing business with these appraisal companies, appraisals through TexasBusinessesForSale.com are typically much more competitively priced.

Many factors affect the price of a business appraisal for businesses which ranges from $1,500 to $7,500. However, most appraisals average about $1,800 to $3,500. Feel free to request further information about obtaining a business appraisal by:

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