Tip #95 – Does The Business Generate Enough Cash Flow To Justify The Price?

Cash FlowBuyers will make an acquisition of a business only when it makes financial sense.

There are a few ways to make that justification, but in general terms, the acid test is to compute the cash flow to cover debt service, a salary to the new owner, and a return on investment.

A professional advisor can be helpful in determining cash flow and how to justify the price of a business.


Michael MarksMichael Marks, creator of Toons ‘n Tips, is a Certified Business Intermediary (CBI) and has over thirty-six years of business experience and ownership. He is a licensed real estate broker in the state of Colorado and has been selling businesses for over eighteen years. Michael has taken up cartooning as a hobby in recent years and has found that by using those skills, along with his extensive business experience, he has been able to create the Toons ‘n Tips drip marketing service for clients all over the country. Find out more about Michael at www.toonsntips.com.
2017-05-09T09:01:03+00:00May 9th, 2017|Maximizing Business Value|