//What is Fair Market Value anyhow?

What is Fair Market Value anyhow?

When determining the value of a business there are many terms which can be confusing.  The term most often used if Fair Market Value and is defined as:

The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus.  Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby:

1. The Buyer and Seller are typically willing and knowledgeable.

2. Both parties are well informed or well advised, and each acting in what they consider their own best interests.

3. A reasonable time is allowed for exposure in the open market.

4. Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto.

5. The price represents the normal consideration without special or creative financing or sales concessions to outside parties.

By | 2018-03-14T16:35:50-06:00 December 1st, 2017|Business Valuation Expert Tips and Information|0 Comments

About the Author:

Business Valuation Expert at My Biz Value having valued hundreds of businesses and dental practices nationwide, Rick is an expert in valuing all types of businesses. He has access to multiple national databases of comparable business sales which are used in the Valuation Reports. His business sales experience lends itself well to correctly valuing businesses. See: www.MyBizValue.com Mergers and Acquisitions (M&A) Professional. Head of the M&A division of Business Sales Group. Advisory services are offered to clients in the Rocky Mountain and Midwest regions of the US. BSG occupies the Mid-market space specializing in selling and buying high growth potential businesses with ample runway having Sales of $1 million-$50 million. Rick is a "deal guy"​ who specializes in maneuvering through the "sticky"​ parts of a transaction to accomplish the Seller's objective. See: www.Bsalesgroup.com

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