Quantitative criteria determining the selection of multiplier metohods in valuing a small enterprise based on dental services

Purpose:The main purpose of this article was to present the key factors determining the valuation of a small business.As part of the research conducted, quantitative criteria determining the economic value of small businesses were defined and evaluated.The article presents the most commonly used multipliers and their importance from the perspective of determining the value of a small business.The key factors shaping the value of a small business taken into account in determining the weights necessary for the preparation of a valuation are included in the analysis.Small entities are defined as enterprises whose competitive advantage and high profitability is conditioned by the specialised knowledge and education of their owners, who usually practice the so-called liberal profession.The choice of dental services was dictated by the specificity of the business to be valued, the fact that one business can be run by people with similar specialisations.Design/methodology/approach: In order to answer the research question posed, an analysis of the financial statements for the years 2016-2020, i.e. a period of 5 years, was carried out.Due to the COVID-19 pandemic, the financial situation of enterprises before the pandemic was also taken into account, with the assumption of a period of stabilisation of the financial situation in 2016-2019.The structure of current and non-current assets and its impact on shaping the financial result of the enterprise was assessed.The research was based on the financial data of 15 enterprises operating in the dental services industry located in the capital city of Warsaw.Findings: Preliminary results of the study showed that the value of a dental practice is most strongly shaped by factors such as the stability of staff employment and investment in facility equipment.The performance of businesses related to the COVID-19 pandemic did not significantly affect dental businesses.Originality/value: The topic addressed is a new issue from the quantitative side.It combines a very diverse range of issues, taking into account both a quantitative approach focused on financial analysis and a qualitative approach relating to the assessment of the situation by consumers of medical services.The essence of the issue taken up is that it relates to the specifics of the liberal professions, the way of valuation of which differs from other businesses.