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Intangible Asset Valuation
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A few guidelines for maximizing the value of a business' intangible assets.

A few guidelines for maximizing the value of a business' intangible assets.

Published in Business , Technology
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  • 1. Business Valuation:Intangible Assets Presentation by Schwartz Heslin Group, Inc. (SHG)
  • 2. Intangible Asset Valuation…• Is both art and science• Varies extensively by company and methodology• Is essential to accurately assessing the value of a business
  • 3. This presentation examines General Guidelinesfor how intangible assets affect the valuation of a business
  • 4. Four Common IntangiblesWe’ll cover four the most intangible assets involved inbusiness valuation:• Customer Relationships• Trademarks• Non Compete Agreements• Intangible Technology
  • 5. Customer Relationships • Maintaining healthy customer relationships can be the backbone of sustaining consistent and reliable revenue streams • Satisfied customers return for repeat business and can be referral sources
  • 6. But…• Too few customer relationships and little reliable repeat business can negatively impact the value of an enterprise• Positive effects of good customer relationships will vary with business model• If a business is dependent on a single individual to bring in an outsize proportion of revenue, it may be too dependent on that individual
  • 7. So…Rely on a diverse group of individuals to draw inbusiness to bolster enterprise value ORBetter yet, rely on a Brand Image  this insulates a company from management changes and dependence on individuals  bolstering companyvalue
  • 8. TrademarksTrademarks can valuable branding tools Can impact customer decision making Can identify a brand with qualityBut… • An unknown trademark is fairly worthless • Poorly repute branding materials can have a negative impact on business value
  • 9. Non Compete AgreementsNon competes can insulate a business from potentialcompetitors by barring key individuals from creating arival enterprise • Ensuring a less competitive space adds value to a business
  • 10. But…Failure to get a non compete agreement from keymanagers opens a business to competition  Has a negative impact on the value of a business
  • 11. Proprietary TechonologyAcquiring and maintaining technological expertise hasa positive impact on the value of a business• This includes: o Engineering drawings o Procedures o Systems o Technical documents o Other technological know-how
  • 12. But…The value of technological expertise will vary with • How expertise is maintained and organized • How such assets are applied to production processes • Business modelIn general, technological expertise will have a positiveimpact on enterprise value
  • 13. Intangibles and Business Value• Intangible assets can have a substantial impact on the value of a business• There are many types of intangible assets• Different types and applications of intangibles cause variance in their values across companies
  • 14. For Business Owners• Proper intangible asset valuation can make a substantial difference in the sale value of a business• Have your business appraised by a professional with experience with intangible asset valuation before selling your business
  • 15. Presented by: Schwartz Heslin GroupAddress: Or visit us on: 8 Airport Park Bvld. Latham, NY 12110Phone: 518-586-7733 Web: www.shggroup.com