I am often times ask why I need to do an onsite visit of a company.  In the multifaceted process of business valuation, a site visit stands as one of the most pivotal components. A site visit implies a meticulous walkthrough of the business premises, offering the valuator an in-depth perspective and comprehension of the business’s operational facets, tangible assets, and overall environment.  It is a gateway to perceiving the day-to-day operations, management effectiveness, and potential risks or opportunities that may not be apparent through financial statements alone.  The onsite visit is included in the business valuation standards.

The difference between a good and a great business valuation could very well be the careful and insightful observation made during a site visit.  A detailed walkthrough can unveil a myriad of latent aspects about a business, bringing to light what financial documents alone might never disclose.”

Accuracy and Reliability:

A site visit aids in verifying the authenticity and correctness of the data provided in the financial statements and operational documents.  It allows valuation experts to compare reported information against actual conditions, thereby identifying any inconsistencies or misrepresentations.  This real-world verification ensures that the valuation conclusions drawn are solidly grounded in factual, observable conditions.


The assurance of data accuracy and reliability is foundational for the entire valuation process.  Any inaccuracies or misrepresentations can lead to incorrect valuations, impacting negotiations, sales prices, and strategic decisions.

Operational Insight:

Observing the day-to-day operations, management interactions, employee engagement, and workflow dynamics provide invaluable insights into how efficiently the business is run . This also includes understanding the company culture, employee morale, and the effectiveness of leadership, which are often intangible elements not reflected in financial documents but significantly impact value.


Operational efficiency and effective management are key drivers of business value.  Gaining insights into these areas helps in accurately assessing the business’s earning potential and sustainability, thereby influencing the valuation outcome.

Risk Assessment:

A site visit enables the identification of potential risks and liabilities such as operational hazards, regulatory compliance issues, or employee discontent that may not be disclosed or apparent in financial documents.  It offers an opportunity to gauge the business’s vulnerability to external and internal threats, thereby allowing for more accurate risk profiling.


Accurate risk assessment is crucial as it may impact the discount rate used in valuation models. Recognizing and quantifying risks ensure that they are adequately accounted for in the final valuation, preventing overvaluation or undervaluation of the business.

Asset Verification:

Physical verification of assets is imperative to confirm the existence and condition of the tangible assets reported.  It ensures that assets are properly accounted for and evaluated, from real estate and machinery to inventory and technology.


Tangible assets often constitute a substantial portion of a business’s value.  Verifying assets’ existence and condition ensures that the asset-based approach to valuation, if used, is reliable and reflects the true worth of the business’s tangible assets.

Environmental and Locational Insight:

Assessing the business environment, location, market accessibility, and surrounding community is pivotal. It gives insights into locational advantages or disadvantages, market competition, and potential growth or decline in the market value of the property and business.


The location and environment can have a substantial impact on business value, affecting customer accessibility, supply chain efficiency, and operational costs.  Understanding these elements is crucial for an accurate assessment of the business’s market position and future growth potential.


Conducting a site visit is not merely an observational formality but a rigorous analytical process, blending tangible assessments with intangible insights.  It’s a convergence point where numbers meet reality, and theoretical valuations are tested against operational truths.  The depth and breadth of understanding it provides form the cornerstone for a robust, well-rounded, and authentic business valuation.  Every business contemplating a valuation should insist on a comprehensive site visit to ensure that the final valuation is not just a reflection of financial health but a true representation of the business’s intrinsic and market value.

I have earned a Master’s Degree in Business Valuations and apply those skills to my everyday business valuations.

Richard Claywell has been valuing closely held companies since 1985.  He has earned two of the highest designations in the business valuation field , the Certified Business Appraiser (“CBA”) and Accredited Senior Appraiser (“ASA”),  Richard is a Certified Public Accountant, has a Master’s in Business Valuation (MBV)  and holds the ASA, CBA, ABV, ICVS, CVA, MAFF, CFD, ABAR, CVGA, ICVS-A credentials.

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