Business valuation for UK company owners.

What your business is worth, and why

Understanding the true value of your business is essential when planning a sale. A valuation is not a single number; it is a range, supported by reasoning, that reflects what an informed acquirer would pay for the earnings and the risk they are taking on. EXITS.co.uk provides a confidential pre-sale appraisal that sets out that range and, more importantly, the specific factors that move it.

How UK private company valuations are actually built

Most owner-managed UK businesses are valued on a multiple of maintainable earnings, usually adjusted EBITDA, applied on a cash-free, debt-free basis with a normal level of working capital. Asset-backed businesses, early-stage or loss-making businesses and those with contracted recurring revenue are assessed differently. The multiple is not a market constant: it reflects the durability of the earnings and how easily a buyer can verify them.

The adjustments that matter

Adjusted earnings normalise for items a new owner would not inherit: an owner's remuneration above a market salary, personal costs run through the business, one-off legal or restructuring expenses, related-party rent that is not at market rate, and non-recurring income. Each adjustment must be evidenced, because every one of them will be tested in due diligence. Adjustments a buyer cannot verify are usually discounted entirely.

What raises and lowers the range

Value rises with recurring or contracted revenue, a diversified customer base, a management team that operates without the owner, documented processes, clean and timely management accounts, and secure premises and intellectual property. It falls with customer concentration, dependence on the owner for sales or technical delivery, unresolved disputes, expiring contracts, deferred capital expenditure and financial records that cannot be reconciled quickly.

Price is not proceeds

The headline figure is not what reaches your bank account. Deal structure — deferred consideration, earn-outs, retentions, warranties, the treatment of surplus cash, debt and property — determines the cash on completion and the risk you continue to carry. Tax treatment then applies on top, and depends on your personal circumstances; you should take advice from your own accountant or tax adviser before making decisions based on any valuation.

What the free appraisal is and is not

Our pre-sale appraisal is a confidential, no-obligation, market-based view intended to inform your planning. It is not a formal valuation report for tax, litigation, shareholder-dispute or statutory purposes, and it is not financial, legal or investment advice. Where a formal report is required, we will say so and can explain the type of specialist you need.

What a valuation can and cannot tell you

A business valuation is an informed assessment, not a price. It sets a defensible range based on maintainable earnings, risk and comparable transaction evidence. The value eventually achieved is decided by what credible buyers are willing to offer for that particular business at that time, and by the terms a seller is prepared to accept. A well-supported valuation is what allows you to judge an offer against something other than hope.

For that reason we publish no standard multiple and no headline figure. Two businesses with identical profits can be worth materially different amounts once customer concentration, owner dependence, contract quality and buyer appetite are taken into account.

What happens after a valuation

If the range is close to what you need and the business is ready, the next step is a confidential sale process: see how EXITS.co.uk sells a business. If the range falls short, or the risks a buyer would price in are fixable, the work usually belongs in exit planning first — most of the factors that move value need twelve to twenty-four months of trading to demonstrate.

Valuations are prepared by the EXITS.co.uk advisory team and discussed with you directly by Tony Vaughan, director of Exit Partners Limited.

How to start

Send us an outline of the business — activity, broad location, turnover, adjusted profit and ownership structure — and we will come back to you confidentially. Nothing is marketed and no buyer is approached without your written instruction.