This is a question I hear all the time.
My answer is: You can. But here’s why it doesn’t work out.
- The appraised value reflects market reality.
An appraisal isn’t just a random number. It’s based on market data, financial performance, and what buyers are willing to pay for similar businesses. Asking for more means ignoring what the market says your business is worth. - Buyers and lenders rely on the appraisal.
Most buyers don’t have cash sitting around. They use financing. And lenders use the appraised value to decide how much they’ll loan. If your price is higher than the appraisal, the buyer has to cover the difference, which can kill the deal. - Overpricing sends the wrong signal.
Asking for significantly more than the appraised value can make buyers think you’re unrealistic or uninformed. They might skip your business entirely and move on to one priced fairly. - Time is money.
Overpricing can lead to your business sitting on the market for months—or even years. That delay could cost you money and momentum. Pricing it right from the start attracts serious buyers. - Purchase Price Justification. Purchase‑price justification may run through every formal test—coverage ratios, market multiples, the “sanity checks” our standards require—but if the post‑closing cash flow cannot service the debt stack, the price is simply unsustainable . I have seen sellers push past the appraised value by agreeing to carry a note, only to repossess a business drowning in negative cash flow; that painful lesson shows it is often smarter to take a smaller, all‑cash number at closing than a bigger figure that collapses later.
Here’s the key takeaway: The appraised value isn’t meant to limit you. It’s a tool to help you sell your business quickly and at a price buyers and lenders can support.
You’ve worked hard to build your business. Pricing it properly ensures you can hand it off to the right buyer and walk away with the reward you deserve.
Have questions about pricing your business?