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How to value an e-commerce company like Amazon, Alibaba, and Daraz?

business valuation

e-business valuation

Business Valuation

Valuation of any business company is simply the step-wise process of knowing the actual market value or monetary value of the company. Business valuating companies consider various factors that directly/indirectly fluctuate the company’s core values during the valuation process.

E-Commerce Company

E-commerce companies like Reddoko, Amazon, Sastodeal are the ones, performing buying and selling activities over the internet. The valuation of any e-commerce company is important as its net worth keeps fluctuating. The factors that affect the value of any e-commerce company can be listed as:

  1. Company’s investment
  2. Customer base
  3. Traffic generation on the internet
  4. Momentum towards goal achievement
  5. Revenue from product sales
  6. Available working capital and net debt
  7. SOPs (Standard Operating Procedures) observed
  8. Values of assets and liabilities
  9. Product/Brand value
  10. Customer service and so on.
valuation of e-commerce business company
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Why E-commerce Business Valuation?

Either for your safe exit from the business or for the better business development planning processes, business valuation is very important. Similarly, Some other reasons for which e-commerce businesses might need business valuation are:

  1. Tax fulfillment
  2. Digital marketing
  3. To Secure intellectual property
  4. Raising investment capital
  5. Adding shareholders or investors
  6. Merger with another company
  7. For various succession plans and so on.

So, For accurate business-valuation, effective utilization of the right tool with proper processes and judgment is the most. Additionally, the deeper insight is necessary as it directly affects the future of the company regarding various aspects. This is where a business valuation company’s role comes into play.

Methods of E-commerce Business Valuation

The best business valuation company with a core team of depth understanding in e-commerce business valuation can perform the valuation processes in the most efficient manner using effective tools. They also use proper and up-to-date analytical methods to assign the best and real value to your company as below :

  1. Comparable Analysis: The value of any e-commerce business is compared with other similar companies and businesses operating in the market/internet. However, In this analytical process, the traffic generation and sales that occur at similar companies in a specific time are primarily taken into consideration.
  2. Precedent Transactions’ Analysis: During this process, e-business valuation companies compare the business value of an e-commerce company with the recently sold or acquired similar businesses or sites.
  3. Discounted Cash-Flow Analysis: Based on the projections of future cash flows of the e-commerce business, valuation companies use various analytical skills to know today’s investment value of the e-commerce company.

So, get your e-business valuation done through one of the leading business valuation service providers. This will help you know your true business value and see where you actually stand in the market. Also, e-business valuation will be helpful in making specific plannings for future strategies.

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