If you’ve owned a business in Florida long enough, someone has probably asked you, “So, what’s it worth?”
The first time, you might answer quickly—just to have an answer. The second time, you might pause. Because deep down, you’re not sure if your number is spot-on, too high, or embarrassingly low.
Fair Market Value—FMV for short—isn’t complicated in theory. It’s the price your business could sell for if both the buyer and the seller truly understand what they’re looking at, neither one is under any pressure to make a deal, and the market has had time to settle on a number. That’s it. No tricks. No rush.
Let’s make it real. Imagine Gator Joe’s Marine Repair in Fort Pierce. Joe has been working on boats for eighteen years. He knows the rhythms of the seasons, which captains are patient and which aren’t, and the smell of salt air before a storm rolls in. His books show steady earnings—not a jackpot, but reliable.
Joe thinks his business is worth $1.2 million. A buyer from Palm Beach looks around, nods politely, and offers $850,000, calling it “fair market value.”
The truth? Neither of them is necessarily wrong. Without agreeing on what FMV actually means—or looking at what similar marine repair shops in Florida have sold for—they’re just two people with two different ideas of “fair.”
Part of the problem is that there are other “values” floating around. Fair Value, often used in court cases, ignores some discounts. Investment Value is all about what the business is worth to a specific buyer, which might be more—or less—than the broader market would pay. Fair Market Value is meant to be neutral ground, where no one gets an unfair advantage.
For owners, the important thing is knowing which definition is in play. Otherwise, conversations about price can wander into strange territory, and it’s easy to feel like you’re speaking different languages.
And that’s the real point here. FMV isn’t about chasing the biggest number possible. It’s about having a shared understanding of value so that, if the day ever comes when you want or need to sell, you and the other side are starting from the same map.
For smaller owner-operated companies, this definition is often the most practical place to start. But it’s not the only lens out there. Larger transactions—think manufacturing plants, multi-location medical practices, or regional service chains—sometimes lean on different valuation standards entirely. Those bring in other layers of complexity… and we’ll save that conversation for another day.
Simone Dominique is an industry analyst focused on the human side of business transitions. Through her writing and research, she provides clarity on the M&A process for owners and buyers, exploring the intersection of market data and owner psychology.
