Brand Sale & Purchase
Analysis on Current Brand Valuation Methods?

Analysis on Current Brand Valuation Methods?

Update: 8/2/2017 | 11:35:14 AM - Dragon Law Firm

Dragon Law in Hanoi support with best legal services in brand valuation for sale and purchase.

Previously, people only assess the brand when they acquire brands of others, but rarely evaluate its brand. It is due to the accounting standards recognized only the "reputation" once intangibles were sold for a specific price.

High experienced lawyers in brand valuation, Dragon Law found that tangible assets is considered a key part of the enterprise value. The evaluation of the profitability and business efficiency of enterprises still rely on indicators such as rate of return of capital, assets, and equity. All of these factors don’t take into account the intangible assets.

However, the growing disparity between the book value and market value of company stocks has led to more and more people recognize the value of intangible assets. And it appears the demand from brand valuation.

 

Dragon Law_Brand valuation analysis

 

Many brand methods use consumer research to assess brand value. These models do not apply financial value to brand, which measure the behavior and attitudes of consumers have an impact on the economic efficiency of the brand. These models use a variety of different measurements based on consumers such as the level of awareness, understanding, familiarity of the product, the specific characteristics of the image, the factors to consider when they go shopping or customers’ preference, satisfaction and introduction to others.

However, these methods do not distinguish the impact of important factors such as research and development, and design for the brand. Therefore, they cannot currently be the link between the specific marketing metrics to financial performance of the brand.

A brand can achieve very high results with these indicators, but still failed to create financial value. Understanding the factors that would be useful for evaluating the decision to  success or failure of a brand purchase. But if it not be integrated into an economic model, it will not be enough to assess the economic value of the brand.

To other financial brand valuation methods based on cost, stocks, revenue … of a company is also not easy to become best consideration for brand valuation.

The method is based on the cost to brand valuation such as R&D, marketing, advertising, media ... But this approach can fail because the amount of investment into the brand is unlikely to create the increase of brand value.

According to the method of the price value between current and future branded product and a general product with brand or without brand. However, the main purpose of many brands do not necessarily sell a higher price, which is guaranteed to attract the highest level of demand in the future.

Most of the above methods or lack of financial elements and marketing to be able to assess the full and accurate economic value of the brand.

The method is based on the economic benefits, combined to measurements of brand equity or financial indicators, has become a brand valuation method is widely recognized in the world. This method is based on the fundamental principles of marketing (brand effectiveness and efficiency of enterprises) and finance (net present value calculation of future benefits of the brand).

 

For more details on brand valuation in M&A, please contact to prestige lawyers in Vietnam to be consulted:

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Dragon Law Firm - Hotline: 1900.599.979

Website: www.vanphongluatsu.com.vn - www.dragonlaw.vn

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