MARKET DATA APPROACH
In other types of Appraisals, mainly real estate, the market data approach indisputably
will always yield the most accurate results. It is a true representation of the
current marketplace because it is what the market is paying for the same or similar
asset. In the case of a Business, using public or private comparable sales price-
Comparing Similar Business Types, sales levels, discretionary earnings and asset
The comparison starts with a similar Business type.
Comparing Business sales levels that are as similar as possible to the Business being Appraised.
Using a comparison of Discretionary Earnings -
The Business Appraiser also must compare the asset values of the Comparables
and use the comparables that most closely compare to the Business being
The market data approach can be very useful when analyzing data drawn from the market
as to what types of ROI (return of investment) ratios are customary, or data based