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Business Valuation and Appraisal Chicago 

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Business Valuation and Appraisal Chicago

For business owners, shareholders, and other stakeholders in a business, understanding the business’s worth and value is an important part of making decisions about the business’s future. At Allstate Appraisal, we provide services for business valuation and appraisal, Chicago, that are based on experience and best practices. If you need to know the value of your business, our team can help. Reach out to our professional valuation and appraisal team in Chicago directly at your convenience to learn more. 

What’s the Difference Between Business Valuation and Business Appraisal?

While the terms “valuation” and “appraisal” are often used interchangeably, the truth is that they are actually distinct from one another. An appraisal will provide information about the value or worth of a business, but it doesn’t usually have a strong legal standing. A valuation, on the other hand, can provide a definitive value that can be referenced for legal purposes, such as purchase agreements or legal disputes. 

The important thing to know about both business valuation and business appraisal is that they both can provide you with information about the value of your business—information that can guide you in making decisions in the future. 

Uses of a Business Valuation or Appraisal

A business valuation or appraisal may be sought out for a number of purposes, including making business decisions about products, employees and staff, services offered, expansion plans, etc. Most commonly, though, business valuation and appraisal are used for the following reasons: 

  • To plan for future transactions, such as exit planning, equity financing, or preparing purchase agreements;
  • To prepare for tax reporting and the accurate reporting of donations, deductions, expenses, etc.;
  • For financial reporting to shareholders and other interested parties; and
  • In litigation and legal disputes—business valuation or appraisal may be necessary for a civil suit, such as a divorce, shareholder dispute, or even a personal injury claim. 

Methods for Determining Value

There are three different commonly accepted ways of determining the value of a business. If you have questions about any of these methods, speak to a professional directly. 

  • Asset approach. The asset approach is a very straightforward way to value a business, and involves adding the value of all of a business’s assets and then subtracting its liabilities. While this simple approach is effective in many situations, it’s not appropriate for businesses with more complex structures or/and intangible assets. 
  • Income approach. The income approach is similar to the asset approach. The income approach considers all of a business’s income against liabilities and debts, accounting for things like projected revenue in the future, future profits, and future working capital needs. 
  • Market approach. This type of valuation method relies on looking at the value of similar publicly traded companies or the sale or merger transaction records of companies that are comparable. 

Why Work with Our Professionals at Allstate Appraisal?

At Allstate Appraisal, we have over 60 years of experience working with businesses like yours. We are committed to providing credible, reliable, compliant, and accurate services for business valuation and appraisal. Chicago-based services for your business are available now. Call today to get started. 

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