Marketability Discounts Software: Quantifying Marketability Discount Modeling

Z. Christopher Mercer, ASA, developed the New Quantitative Marketability Discount Model (QMDM) software users manual. Chris Mercer is the founder and CEO of Mercer Capital Management, Inc., one of the leading independent business appraisal firms in the country.

Marketability discounts often represent the largest adjustment made to the value of a business. This superb Excel® based financial model assists appraisers in developing, quantifying and defending marketability discounts.

There are numerous approaches and studies that are currently used to determine appropriate marketability discounts. However, little exists in theory or practice to assist appraisers in applying the existing research to the specific circumstances of business appraisal scenario. Subsequently, most appraisers use "average" premiums or discounts, tempered with modest, or no adjustments predicated on the specific facts of a case. QMDM addresses these situations by allowing the appraiser to very closely model specific scenarios to accurately determine an appropriate marketability discount.

What will QMDM do for you?

  • With QMDM, you'll be able to calculate marketability discounts based on a specific factual situations rather than just averaging results from various marketability studies.
  • You'll gain a solid understanding of the theoretical precepts for developing sound marketability discounts, as well as specific instructions on using the QMDM model included in the on-line user's manual.
  • The resultant discounts produced by QMDM can be incorporated into these Wiley-ValuSource valuation programs: ValuSource Pro (Versions 2001, 2000 and 1.06) and Value Express (Versions 2001 and 5.0)
  • You'll probably encounter QMDM in the courtroom or while reviewing valuation reports. Since so many practitioners in the valuation community use this methodology, shouldn't you, at the very least, be familiar with its theory and application? This is particularly true for those who choose not to use it in their appraisal methodology.
  • This software is based on Z. Christopher Mercer's book, "Quantifying Marketability Discounts". The software is the perfect way to put the book's comprehensive discussion on this issue into real-world practice.