Southard Financial
Know the Value of Your Business

Why You Need to Be Realistic About the Value of Your Business

Here’s something you don’t usually hear a transaction advisory firm say: sometimes we can’t sell your business!

It’s not for lack of preparation. At Southard Financial, we go over every client’s business situation with a fine-toothed comb to accurately determine the value range of what their company is worth.

It’s not for lack of experience. In our case, we’ve been at this for over 30 years.

Why Deals Die

When deals fall apart, it is most often because the seller decides to go to market with expectations of value that are not realistic. In their mind, their company is worth one price, but potential buyers think it is worth significantly less. Even when presented with solid market evidence, the seller refuses to budge…and no buyers come to the table—or an interested buyer walks away.

In those instances, we can’t help them sell their company.

How to Avoid a Failed Sale

A great way to keep from having a transaction fall apart at the end is to establish a realistic value range at the beginning.

When a new client approaches us about helping to sell their business, one of the first things we do is begin looking at their company from every angle.

  • We examine their financial records to make sure everything is in order.
  • We do a comparative market analysis of similar businesses to see what they have sold for recently.
  • We also take external factors into consideration, like: trends in the area where the business is physically located, current economic situations, industry factors, etc.

Essentially, we imagine ourselves as potential buyers in order to see the company through their eyes.

Once we’ve compiled all of this information and more, we create a report for the seller that gives them a bottom line, real-world value estimate of their company as it stands. Then we go a step further and include suggestions for improving its value prior to putting it on the market.

If our value estimate is too low for the owner and they are unwilling to make any financial and operational enhancements, then we probably can’t help them sell it.

What to Look For

If you shop around for companies to represent you as you sell the business you built, make sure you talk to several.

  • If they seem quick to agree with whatever price you “feel” is right, they are probably not going to be your best partner. They’re usually only interested in making money through a high volume of clients…gambling that if they do enough deals, some will actually succeed.
  • If they can’t give you helpful suggestions for making your business even more valuable, they aren’t really invested in your success.
  • If they haven’t done more than a couple of deals, you’ll probably end up leaving good money on the table because of their inexperience.

We do the opposite of all those things. At Southard Financial, we want to see you win. We value hundreds of businesses every year (of every type and size), and our valuation experience gives us the know-how to help sellers maximize their value.

If you’re considering selling your business and you’re ready to learn how a team like ours can help, connect with us today.

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Recent Activities

  • Southard Financial facilitated the sale of Memphis' own Cooper Glass Company

    Southard Financial facilitated the sale of Memphis' own Cooper Glass Company
  • David A. Harris and Mark A. Orndorff spoke at the 2019 Annual Fall Conference of the New South Chapter of The ESOP Association

    David A. Harris and Mark A. Orndorff spoke at the 2019 Annual Fall Conference of the New South Chapter of The ESOP Association held in Orlando, Florida on October 16-17. They gave a presentation titled “Can Employees Really Impact Company Value?”

  • Southard Financial facilitated the sale of Memphis' own TOPS Bar-B-Q chain

    Southard Financial facilitated the sale of Memphis' own TOPS Bar-B-Q chain
  • David A. Harris and Matthew L. Jakes spoke at the 2019 Spring Workshop of the New South Chapter of The ESOP Association

    David A. Harris and Matthew L. Jakes spoke at the 2019 Spring Workshop of the New South Chapter of The ESOP Association held in Atlanta, Georgia in February, 2019 on the topic of “Valuation Appraisal Checklist – 10 Things Your ESOP Appraiser Should be Doing”

  • David A. Harris spoke at The Fall ESOP Forum of the NCEO

    David A. Harris spoke at The Fall ESOP Forum of the NCEO (National Center for Employee Ownership) held in Albuquerque, New Mexico in October, 2018 on the topic, “Communicating Valuation: Tools, Tips, and Examples”.

  • Southard Financial negotiated the sale of and was the exclusive financial advisor to Southern Systems, Inc.

    Southard Financial negotiated the sale of and was the exclusive financial advisor to Southern Systems, Inc.
  • David A. Harris spoke at the 2018 Annual Fall Conference of the New South Chapter of The ESOP Association

    David A. Harris spoke at the 2018 Annual Fall Conference of the New South Chapter of The ESOP Association held in Birmingham, Alabama in September, 2018. He led a workshop called “The People’s Roundtable Interactive Workshop – A series of ‘Build to Last’ activities that focus on developing successful communication and team building programs for employee owners of all generations.” Speakers included Dolores Lawrence, Blue Ridge ESOP Associates; Lindsay Baublitz, SCandH Capital; David Harris, Southard Financial LLC

  • Mark A. Orndorff spoke at the ESOP Nuts & Bolts Seminar of the NCEO

    Mark A. Orndorff spoke at the ESOP Nuts and Bolts Seminar of the NCEO (National Center for Employee Ownership) held in Indianapolis, Indiana in August, 2018 on the topic of “What’s Your Company Worth? – ESOP Valuation.”

  • Southard Financial helps Transnetyx expand with growth capital

    Southard Financial helps Transnetyx expand with growth capital
  • Mark A. Orndorff spoke at the American Booksellers Association Winter Institute

    Mark A. Orndorff spoke at the American Booksellers Association Winter Institute 2018 held in Memphis, TN in January, 2018 on the topic of Succession Planning titled “What is Your ‘End Goal’?”

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