Free Business Valuation Calculator

A business valuation is an estimate of what a business may be worth. It is usually based on financial performance, maintainable profit, risk, growth prospects, buyer demand and how transferable the business is to a new owner.

Company valuation and business valuation are often used to describe a similar process: working out what a business could be worth based on its performance, assets, risks and market appeal.

Not always. A valuation is an estimate of what a business may be worth, while an asking price is the figure used when presenting the business to the market. The asking price may be influenced by negotiation strategy, buyer appetite, deal structure and the seller’s objectives.

Yes. Intelligent’s business valuation calculator is free to use and designed to give business owners a quick starting point.

Yes. Valuation enquiries are handled confidentially, and identifying details about your business are not shared without your permission.

No. A valuation should help you understand your options. Many owners request a valuation before they are ready to sell so they can plan ahead, understand what drives value and identify improvements.

Many business valuations start with maintainable profit, adjusted net profit or EBITDA. A valuation multiple may then be applied, with the multiple influenced by factors such as sector, business size, management strength, owner dependency, recurring revenue and growth potential.

Turnover can be a useful starting point, especially for newer businesses, but it does not give the full picture. A realistic business valuation should also consider profit, risk, sector conditions, buyer appetite and the wider circumstances of the business.

Businesses are less standardised than property. Two businesses with similar turnover can have very different margins, systems, risks and levels of owner involvement. A business valuation calculator can give a useful guide, but the final sale price depends on real buyers, funding, negotiation, due diligence and deal structure.

Value can be increased by strong profits, reliable financial records, recurring revenue, low owner dependency, clear systems, a stable team, loyal customers, growth potential and evidence that the business can transfer smoothly to a new owner.

Value can be reduced by heavy owner dependency, unclear financial records, weak systems, customer concentration, lack of growth prospects, restrictive contracts, staffing issues or other operational risks.

Annual turnover is the total amount of income a business generates from sales over a 12-month period, before costs and expenses are deducted. It is sometimes referred to as revenue or sales income.

For a business valuation, turnover helps show the size and trading activity of the business, but it does not show how profitable the business is on its own.

Net profit is usually the profit left after the normal costs of running the business have been deducted. Depending on the accounts used, this may be shown before or after tax, so it is often reviewed alongside adjusted profit or EBITDA when valuing a business.

Net profit is an important part of a business valuation because buyers often want to understand how much income the business can realistically generate.

Some discretionary or one-off costs, such as directors’ pension contributions, exceptional expenses or non-recurring costs, may be adjusted to produce an adjusted or normalised net profit.

EBITDA stands for earnings before interest, tax, depreciation and amortisation. It is a way of measuring a company’s underlying profitability before certain financial and accounting costs are taken into account.

EBITDA is commonly used in business valuation because it can help show how well the business performs from its core operations. It can also make it easier to compare businesses that may have different tax positions, debt levels or accounting approaches.

Asset value is usually determined by looking at the assets owned by the business, then subtracting any liabilities. Assets may include stock, equipment, machinery, vehicles, fixtures, fittings, property, cash, or other items of value owned by the business.

The value used should reflect a realistic current market value, not just the original purchase price. For example, machinery or equipment may be worth less than it was when first bought, while some assets may hold their value better over time.

Freehold value refers to the value of property or land owned outright by the business. It is usually determined by assessing the current market value of the property, often with reference to comparable sales, location, condition, size, rental potential and wider market demand.

Where a business owns its premises, the freehold value may be considered separately from the trading value of the business. This helps distinguish the value of the property from the value created by the business’s profits, customers, brand and operations.

The best first step is to use the business valuation calculator to get an initial guide. From there, a confidential conversation can help you understand what your business might be worth, whether it is realistically sellable, and what your next options could be.

There is no obligation, and a conversation costs nothing but could save you time and money.