Local business confidence set to improve
This is according to the South African SACCI Index, which showed a decline to 86.5 in 2020 - the lowest since it was created in 1985. The increase indicates that businesses are slowing regaining the confidence needed to navigate the new market.
“The anticipated return to normal trading conditions is set to improve business values moving forward,” says Johann de Lange, managing director and founder of Worth.Business.
Online tool are available that makes business valuations more accessible for companies of any size. Frequent valuations can help financial professionals and business owners to position their clients or businesses to capitalise on opportunities that arise due to the improvement in the market.
“Business values are dynamic and will continue to change as trading conditions improve. The traditional valuation process may cause businesses to miss out on opportunities as it is a cumbersome and expensive process to go through if done frequently. Given the current climate, it is important for business owners to know their company’s worth through frequent, credible valuations,” says de Lange.
Business confidence levels below 100 imply pessimism in the market, which can result in low appetite by local and foreign investors alike. Valuations can help attract investors and showcase local business potential. “This is why it is particularly important for investors, fund managers, and financial professionals to keep track of ongoing improvements in company values,” says de Lange.
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