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Rule of Thumb for selling your business

The most basic rule of Thumb is the net income to sale price ration.  Typically a business will sell from anywhere to 1-3X the actual owners benefit.  Owners benefit is the amount of $ including all personal addbackscell phones, food, vehicles, gas, travel, etc. plus any salaries, as well as discredtioanly cash.  This rule of thumb is for small business doing less than 250K in sales a year.  When buying a business ask yourself what is the profit at the end of the day.  If there is no profit the business is typically worth the value of the Furniture, Fixtures and Equipment in place as well as any intellecutally property ( patents, trademarks, key domain names).  Most business are grossly over priced and it is key to work with a knowledgeable business broker who can help you sort through all of the junk.Big Smile

Published Monday, May 10, 2010 2:27 PM by Pete Harrison

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Tuesday, May 25, 2010 7:21 PM by Bob

# re: Rule of Thumb for selling your business

do you have any opportunities in Bradenton (manatee area)?  Please e-mail me at bob.swift@hotmail.com

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