Brand Value Evaluation For Acquisition

The brands of a company are the most valuable assets of the company which represents the overall market value and its equity

. As per the current statistics the reputed market are growing with high competitions for all the major brands and products. It is quite important for a brand to stabilize its market value and have substantial growth.

The value of a brand is also an important factor for the consumer to consider before making any acquisition of the product. The brand value is taken in consideration because brand value provide a good impression to the consumer that the brand have the market value and the deal for the brand will justified. It is quite difficult for the consumers to correctly evaluate the value of a brand name. Private investigations are helpful to the people of Amman to take the right decision in this direction. There are such brand names available in the market where the brand describes and usages are manipulated to visualize the high impression of the value. At the same time possibilities arise for such brands names which attract the consumers without their existence in the reputed market, such kind of brand names are termed with glorified names. There are major attributes useful for evaluating the brand value whether the brand is real or is a glorified brand name. A real brand name values contains all the prominent attributes and the superior quality.

Evaluators have brought out a prototype system to evaluate the brand value of a product in most of the existing areas. These systems are able to judge whether a brand name is real or is only a glorified name by examining the brand with several view points. The evaluators are conducting researches on preliminary experiments and market surveys to evaluate the value of a brand. More often brand value evaluation is determined by its use. The evaluators have set certain Investigation method based upon the categories of the products. Most of the brands are evaluated through market based approaches where first direct measurement is brand communication investment based methods used for adjustment for inflation. These adjustments are discount rates which are used for computing the net present value of the investments. These methods overvalue a brand and consumer uses them for many purposes while making acquisition decision. A brand can bear a penalty for not advertising heavily. Next direct measurement is the awareness and franchise where the volume and routine use equation of a new product convert the advertising budget into awareness and awareness turns into trial and the trial results into consumption volume and consumer franchise. Private investigation services in Jordan have also been observing certain laid down modalities while evaluating a brand value of a company.

Another one is indirect evaluation method where excess earning method access the increase in profit (cash flow) attributes to brand. This calculates the cash flow over the useful life of brand and takes up discounted cash flow analysis where every year the projected cash flow is discounted according to risk of investment. The sum of this cash flow plus the residual value of the brand at the end of analysis gives the brand value of the brand. The drawback of this analysis resides in estimating the sale and profit growth effects on the brand. Another indirect evaluation method is relief from royalty method used by financial analysts which is based on the concept if a company in Jordan is not using its brand then it need to license the right in exchange of royalty fee. This royalty fee is calculated on the percentage of sale of the brand.

If the consumer gets the correct brand value then it becomes easy for the consumer to make acquisitions. Corporate investigation in Jordan helps to ascertaining the correct brand values of products which enables the consumers to have the strong confidence in making good acquisition decisions.

by: AbdulSalim2012

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