When it comes to obtaining a business valuation, business owners are faced with a myriad of choices. Should you talk to a business broker? Should you ask your CPA? Should you use a free online business value calculator? Should you use a paid online service? Or should you hire a certified business appraiser? The reality is that every business valuation service will try to convince you why it is the best. As the saying goes, “Never ask a car salesman if you need a new car.”

Here are seven considerations you should take into account when choosing the right business valuation service for you:

Consideration #1: Specialty. Does this person or service specializes in valuing businesses?Many business owners ask their CPA or even their real estate agent to value their business. While their CPA might be a specialist in tax matters and the real estate agent a specialist in real estate, is he or she a specialist in valuing businesses? Valuing a business requires a specialized set of knowledge and experience that may or may not be possessed by one’s CPA or real estate agent.

Consideration #2: Track record. How many business valuations has this person performed? When it comes to matters as serious as determining the value of your business, you want to be dealing with an industry veteran, not a rookie.

Consideration #3: Current market knowledge. Market conditions change all the time. Is this person or business valuation service up to date on the current market conditions? In other words, is this person coming up with your business value based on formulas he or she learned in school many years ago, or based on an intimate understanding of how much business buyers are willing to pay for a business such as yours in today’s market?

Consideration #4: Confidentiality. Chances are that the business appraisal service you hire will want access to your company financials as well as the ability to assess your company’s operational performance. What steps have they taken to ensure the security and confidentiality of your financial data, and to ensure that none of the employees finds out about the potential sale of the business?

Consideration #5: Size of your business.Just as there are many specialists in the field of medicine, there are many specialists in the field of business valuations. There are business valuation companies that specialize in valuing companies with revenues in the tens or hundreds of millions of dollars, and business valuation companies that specialize in valuing small businesses. Where does the size of your company fit within the size range of clients served by the business valuation company? Ideally, you do not want to be the business valuation company’s smallest client, nor do you want to be its largest client.

Consideration #6: Budget. The cost of business valuations can vary greatly. On the low end of the spectrum, you can do it yourself for free using a free online business value calculator. On the other end of the spectrum, a certified business valuation might cost $40,000 or more. There is truth in the saying that you usually get what you pay for, but it does not necessarily mean that the more expensive option is always better for you. As the size and complexity of the business increase, it is reasonable to expect a higher cost for the business valuation. However, spending tens of thousands of dollars on a business valuation for a small business is probably an overkill.

Consideration #7: Purpose of the valuation. The reason you are getting the business valuation can greatly affect the type of business valuation you need. If you are curious about the value of your business because you might potentially consider selling, one of the more basic business valuations would do. However, if you need a certified business valuation that can be used in court proceedings and trials, the cost of the business valuation would go up considerably. Think of it as the difference between audited and unaudited financial statements. If the business appraiser needs to certify the business valuation report, much more time and energy will need to be spent verifying data provided by the business owner.

Advantage Business Valuations provides business valuation services for small to mid-sized business owners in the United States. Founded by Aaron Muller who has valued thousands of companies as a business broker, Advantage Business Valuations helps small to mid-sized business owners determine the value of their business with ease and confidence. To discover the value of your business, visit www.AdvantageBusinessValuations.com.