Top 8 Reasons to Get a PR Agency Valuation

By Rick Gould CPA, J.D.

business-valuePR agency valuations provide a detailed analysis of financials, profitability, clients, employees, resources and a number of other important factors that influence the value of your firm. Though they can be time consuming and hiring a qualified outside organization to perform the valuation can be an additional expense for your firm, PR business valuations are well worth the resources required to complete them.

While having a thorough understanding of your firm’s value is never a bad idea, there are a number of specific circumstances when it is particularly beneficial to get an accurate PR firm valuation.

1. Partner Split-Up – Understanding the value of your firm is imperative when firm partners are splitting up and potentially dividing firm assets. To ensure that negotiations are fair and reasonable, knowing your firm’s worth is a must.

2. Partner Buyout – In order to ensure a fair transaction takes place when a partner buyout takes place, knowing a firm’s value is key.

3. Partner Buy In – When adding new partners to the firm, knowing your company’s worth is necessary in order to ensure that partners have appropriate and fair fiduciary responsibility within the organization.

4. Potential Merger of Two or More Firms – A firm valuation is a valuable resource to have on hand when considering the merge of multiple firms. Again, knowing the value of your firm will help to ensure that a fair and reasonable transaction takes place should the firm merge with other PR companies.

5. Potential Sale – When contemplating putting your PR firm on the market, knowing how much your firm is worth can help you tremendously when determining an asking price for your business and deciding how much you will accept from a buyer.

6. Potential Growth – Having a comprehensive firm valuation can help greatly with making beneficial business decisions on a day-to-day basis. It can also provide valuable information and insight when large and small opportunities for growth come along.

7. Divorce – Whether a divorce is amicable or not, knowing the worth of your organization is a safe bet when you go into negotiations. Understanding how much the business you worked hard to build is worth can help ensure that a fair divorce settlement is reached.

8. Estate Planning – When organizing your estate and creating a succession plan for your business, it’s important to have an accurate business valuation on hand. This will help you with tax planning and assist you in determining who should ultimately inherit your financial interest in the firm.

In these, and many other, circumstances, it makes good business sense to have a comprehensive valuation of your PR firm. Want to learn more about PR agency valuations? Please refer to our article “Are PR Agency Valuations Worth the Time and Money? Absolutely!!”

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