Thread: COMPANY
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  #19  
Old 04-09-2008
SlowOne SlowOne is offline
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Join Date: Oct 2007
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What a company is worth will depend on its profits, and its goodwill (reputation, intellectual property, brand image, etc.) not just it's size, or market share.

In general, a company is worth 10 to 20 times its profits, plus anything for its goodwill and any premium based on the circumstances of the sale. If a company has a huge turnover, but no profit, its not worth a light (Northern Rock). However, if it has a small turnover, and large profits, it can be worth a fortune (Porsche).

Any decent RC company is going to cost in the scores of milliions of dollars to buy, and if it is Tamiya (look at all that goodwill, by its reputation) then a lot more than that! However, the barriers to entry into the market are quite small, so the cheapest way to 'buy' and RC company is to start your own. After all, that's how they've all got to be where they are now - someone started them in teh recent past, and put the work in to make them what they are now.

And one last thing to remember - the easiest way to make a small fortune is to start with a large one!
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