Agricultural business valuation is the system of obtaining a fair market worth for a business. Whether you are interested in buying or selling a business, assessing its correct value is a very important part of the process. Many factors go into valuating your agricultural business, such as the amount of land you have, its yield per acre and the variety of crops you produce. As there are multiple factors going into assessing your business’ worth, there are also different ways in which you can get your company’s worth. You can use an external valuator to assess the fair price of a business or do it yourself.

Getting a business assessment is an invaluable tool to help you make sound business decisions now and in the future. Follow these steps to find your agricultural business’ worth:

1. Utilize do-it-yourself software to find your agricultural business’ worth on your own time.

2. Consult of information resources to find the value of your agriculture company.

3. Team up with a local business appraiser and work with them in person.

Action Steps
The best contacts and resources to help you get it done

Use agricultural business valuation software to learn your business' worth

Agricultural business valuation software can be very helpful if you are ever looking to expand your business by purchasing more land or buying more equipment. There are factors and formulas used especially for valuating an agricultural business that are included with the package. You will get as accurate a report as you would if an experienced agricultural business assessor did it.

I recommend: Haleo Corporation created ValuAdder that uses market comparables for 400 industries, promising you an accurate report for your agricultural company. The Express Business Valuation software created by ValuSource incorporates industry composition valuation methods and market data to produce a valuation report for your particular agricultural business.

Consider using industry analyses and reports to value an agricultural business

Appraise an agricultural business by consulting trade-specific financial and market reports. A general report will show how the overall economy is looking. An agriculture specific report will go into detail regarding the performance of the agriculture sub-division you are in, such as cattle.

I recommend: IBISWorld is a good resource to find industry-specific financial information like the domestic price of soybeans, for example. U.S. Business Reporter is a good resource to find agriculture-specific financial information, such as the market report for seed corn.

Think about using a professional with experience to purchase an agricultural appraisal

When looking to value an agricultural business, a local professional will have a better idea of your area's economy. This can work in your favor when you are looking to sell your business or purchase more land, for example. These business valuation professionals will also be able to meet with you and go over the unique formulas and calculations that are necessary for a proper agriculture business valuation.

I recommend: Fair Market Valuations has offices all over the country that will give you the most accurate agricultural business assessment report available. BCC ADVISERS, which has offices in Nebraska and Iowa, has many years of experience in agricultural business valuations and have successfully completed a number of projects in that industry.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  When performing an agricultural business valuation, be sure to take into account the changing environmental conditions, such as pollution and rising temperatures, when forecasting future production and sales.