Business Appraisal Florida tries to stay on the cutting edge of business valuation trends. An already unpredictable 2017 promises a change in the valuation of many businesses. We are here to keep you informed, monitor the global climate, and do the hard work for you.
As a business owner, you know your business inside and out. You know your employees, their families, your regulars, and your competition. But do you know the value of your business? Because you should. A business appraisal is such an important step of business ownership that many individuals ignore. An effective business appraisal is essential. Most business owners consider their businesses as their nest egg for retirement. You wouldn’t go years without checking how much money is in your Roth IRA, so why would you with your business? This is vital information that is needed to plan ahead.
On the other hand, you may need to know the valuation of your business at a moment’s notice. If an offer to buy out your business comes through your door, are you ready to adequately make a decision? A business valuation can also help in the face of unfortunate events, such as an unexpected divorce or sudden need to sell. The appraisal process can take time, time that might not be available. Many individuals incorrectly believe that their balance sheet represents their business’s value. This could not be further from the truth. A business’s value entails not just the balance sheet, but the intellectual property, reputation, assets, trade secrets, cash flow, and so much more.
That being said, there are many factors that go into an effective valuation. Many variables and factors that make up a business appraisal change year to year along with the global economy.
Important Trends in 2017
The year 2017 has been anything but predictable. An unpredictable political environment, rapidly changing foreign relations, and shake-ups in manufacturing are all having a significant impact on the economy. Florida businesses have unique characteristics that may make them more susceptible to emerging trends. Our low taxes drive our economy and cause billions of dollars of foreign and domestic investment every year. Business Appraisal Florida is watching these demographic trends as it affects Florida business values. For example, Miami currenlty has over 55 months of inventory on $1,000,000+ new condos. The ability for the marketplace to absorb these units will be telling.
Unpredictable Global Economy
Brexit. Enough said? Well, maybe not. The world markets took a sharp hit when the shocking Brexit vote results reached media outlets. Britain being one of the driving forces of the global economy, Brexit could have a bigger impact in Florida than you may think. The United States does billions of dollars of trade with Britain each year. Britain’s sudden decision to leave the European Union will have far reaching implications across the globe. The fixed costs that you are used to from suppliers, contractors, or advisors could change drastically and affect your bottom line. Not to mention that your customers could feel the impact as well.
Furthermore, there is the constant threat of war looming over the globe. Florida is home to a number of the United States Army’s largest defense contractors. These corporations have recently been starved of funding with previous cuts in defense spending. But this may all change and your close proximity to these resource heavy corporations could mean an influx of demand for your goods and services.
Aspects Unique to Online Businesses
Now more than ever, your business’s online presence has a vital role in the marketplace. It is possible to run a multimillion dollar company from a warehouse, without ever seeing a customer face to face. You have the potential to reach thousands of customers a day without exhausting any significant amount of resources. In fact, in 2016, the growth of the online retail industry was more than ten times that of the retail industry as a whole. For this reason, the value of online an online presence is hard to quantify, but thankfully, it is our job, not yours!
That being said, the value of an effective social media campaign will only increase in 2017. Why is this? For one, a number of users on Twitter has increased significantly since President Donald Trump began favoring the website as a quick way to spread information. We’ve seen companies lose or gain millions from a single tweet or videos going viral. Likewise, the value of a Facebook campaign may not be as lucrative given recent changes in their advertising and “Trending” news algorithms.
Local Trust and Relationships with Customers
Americans are beginning to remember the “good old days” and are focusing on adding value to and supporting local businesses. Floridians are beginning to trust big brand name companies less and less in 2017. The massive movement of manufacturing and service jobs overseas has left a bad taste in the consumer’s mouth. Now more than ever, these local consumers will be looking to support the businesses that support their local communities through job creation.
In addition, 2016 brought with it, a series of major credit card data breaches at large corporations such as Target and The Home Depot. Consumers are fed up with trusting these mega corporations with their vital information, only to hear once again that they dropped the ball. Florida businesses have something they do not: community reputation and trust. You are not just building a reputation, you are building value. Your reputation in the community may be priceless to you, but we here at Business Appraisal Florida promise, that we can monetize it!
If there is anything we know a lot about in Florida, it is home flipping. You may not have realized it, but the home flipping industry provides a significant boost to Florida’s economy. In 2016, demand in the housing market skyrocketed and houses were bought up within days of being listed. This is surprising given that many big banks are still wary of giving out home loans like they did before the recession. However, toward the end of 2016, banks began giving out larger credit lines to home flipping companies, signaling a comeback in the industry. This will draw a lot of attention to Florida, possibly increasing rent for brick and mortar stores as well. We here at Business Appraisal Florida are closely watching the effects of this surging industry.
Cyber Security and Compliance
The cost of cyber security is going through the roof. The recent Wyndham hotels federal court decision gave the FTC the power to enforce strict security regulations on businesses that handle sensitive customer information. Businesses that offer these services will see an increase in revenue and the cost of having a standalone online marketplace may go up.
Contact Business Appraisal Florida for a No Cost Consultation
An effective and reliable business appraisal provides value to your company. You, your family members, and partners may have emotional ties to your business that cloud your judgment. We understand that it is hard to put a price on something you love, but we will pour over every aspect of your business to help estimate its value in today’s ever-changing marketplace. We have been providing local Florida businesses with cutting edge appraisal services for over twelve years and work with partners who have been appraising assets for decades. Trust Business Appraisal Florida to provide you with a reliable and dependable valuation.