Any sign made up of personal names, words, shapes, letters or numbers to distinguish the goods or services of an enterprise from the goods or services of another enterprise is called a "brand".
In addition, in the Decree Law No. 556 on the Protection of Trademarks, “Trademark provides to distinguish the goods or services of an enterprise from the goods or services of another enterprise, including personal names, especially words, figures, letters, numbers, such as the shape or packaging of the goods. or any marks that may be expressed in a similar way, broadcast by printing and reproduced ”.
There are no issues and privileges regarding trademark rights. All kinds of power of disposition on the brand can only be used by the brand owner.
The brand is divided into the following groups in various aspects.
Trademarks, service marks,
Individual brands, warranty marks, joint brands,
International registration (Madrid Protocol).
In our country, the registration, protection, termination of trademarks and other matters on this subject are applied according to the Decree Law No. 556 on the Protection of Trademarks, the Regulation on the Application of this decree and the communiqués issued by the Turkish Patent Institute.
Uses of brand valuation
Marketing performance and distribution of marketing budget,
Company internal management,
License and "Franchising" transactions,
Company acquisitions, acquisitions and mergers,
Bankruptcy and restructuring,
Determining bonuses and bonuses,
Strategic planning and goal setting
Usage Areas of Brand Valuation in Transactions Made in the World
Internal control and performance measurement
Buying a company
Setting a license fee
Calculation of the cost of unauthorized use of the brand
Valuation in Terms of Tax Legislation
Brands, economic assets included in the economic enterprise are valued according to the valuation provisions of the Tax Procedure Law. According to the 269th article of V.U.K;
All parts and details of real estates,
Installation and machinery
Ships and other vehicles,
It is valued like.
Financial Models in Brand Valuation
Cost Based Brand Valuation
Brand Valuation by Market Value
Valuation Based on Capital Markets
Method of Relief from Name (Royalti) Rights
Price Premium Method
Conjoint Analysis Method
Other Methods Taking into Account the Positive Gains of the Brand
Valuations Made Based on Financial Ratios
Models Developed from a Marketing Perspective
Young & Rubicam (Brand Asset Valuator)
Millward Brown (BrandDynamicsTM, BrandVoltageTM)
Total Research (EquiTrendTM)
Research International (Equity EngineTM)
Brand Asset 10 (The Brand Equity Ten)
Lippincott Mercer (Strategic Brand Assessment)
Ipsos Group (Equity * BuilderTM)
Financial World Approach
C. Nielsen Approach
Brand Finance Approach
Brand Rating Valuation System
"Advanced Brand Valuation" Model
"Global Brand Equity Valuation" Model
Brands are one of the important factors that determine the market values of companies. However, the value of brands fluctuates in an increasing or decreasing manner even within the same year. A very valuable brand can become worthless in a short time for various reasons. For this reason, the brand value is constantly changing.
Practices to determine the monetary value of the brand have brought the question of how the brand value should be calculated most accurately. Although there are many mathematical models for brand valuation in practice, the methods do not give reliable results because it is difficult to measure the effects of the brand due to the different characteristics of the companies and the intangible fixed assets.
If we collect the valuation models developed under three main headings; Financial models are models developed from a Marketing perspective and Mixed models.
Since financial models are one-sided and static, ignoring other variables that affect brand value, the need to develop mathematical models that add different variables such as the company's marketing policy and network to the valuation process has arisen. For this reason, detailed studies should be carried out using at least two mathematical models that can evaluate all the data obtained in brand valuation studies.
Company Valuation Report
While calculating the company value, technical analysis and fundamental analysis are performed to reveal the real value of the company in question. While doing this, the current situation of the company and future economic conditions are also taken into consideration.
Liquidation Value Method
Liquidation value is the value of the company in the event of a definite cessation of the activity.
The value of liquidation differs depending on whether a voluntary or compulsory liquidation is considered. Because, in these cases, the liquidation is carried out in more or less difficult conditions. Voluntary liquidation is the sale of active assets within a reasonable period of time in order to obtain the best price for each asset item. In forced liquidation, active assets are sold as quickly as possible, mostly in a one-off auction.
Rebuilding Value Method
The sum of the expenses to be made to rebuild an established facility will give the reconstruction value. In other words, it is the cost of acquiring a facility that is identical with all the features of the property subject to appraisal at the valuation date.
Working Enterprise Value Method
Operating enterprise value (going-concern-value) is a concept used in researching market value. It is defined as the value to be found if the business is transferred as a whole.
According to the synergy effect, the value of the whole will be more than the sum of the values of the parts. Therefore, the value of the enterprise as a whole, according to the value of the operating enterprise, is greater than the sum of the values of its parts. In this method, in the calculation of the value, the potential earnings that the business can obtain in the future should be taken into account as well as the current earnings.
Firm value equivalence considering goodwill;
Working Enterprise Value = Total Net Assets + Goodwill
Discounted Cash Flows (Net Present Value) Method
While calculating the discounted cash flow method, the following steps will be followed.
Assets and liabilities are distinguished, elements are identified (income, investments, depreciation, taxes, working capital, increases / decreases in other assets)
Previous years cash flows are analyzed
The items affecting the cash flows are estimated.
General assumptions and assumptions of various scenarios (optimistic, pessimistic and normal) are determined.
Cash flows are predicted
Discount rate is estimated
The residual value is found
With the reduced cash flows, the value of unused excess land, land and stocks is added together and the present value of the debts is subtracted from this sum to reach the firm value.
Results are analyzed.
Finding Cash Flows with accounting account items
Profit before tax and interest (+)
Tax payment (+)
Dividend Payment (-)
Medium / Long term loan redemption (-)
Cash increase (decrease) (-)
Trade receivables increase (decrease) (-)
Increase (decrease) of other receivables (-)
Increase (decrease) in stocks (-)
Other current asset increase (decrease) (-)
Short-term loan increase (decrease) (+)
Trade payables increase (decrease) (+)
Increase (decrease) of other debts (+)
Other current liabilities increase (decrease) (+)
Working capital requirement (-)
Capacity increasing investments (-)
Maintenance / renewal investments (-)
Medium / Long term loan (+)
Provision for severance pay (+)
Cash capital increase (+)
= CASH FLOWS
NAD = AD - BD
AD: Market value of the company's assets, BD: Market value of the company's debts.
Market Value - Book Value Method
Company Value = Average PD / DD Ratio of the Selected Sector or Market * Book Value of the Company (Equity)
Appraisal Value Method
Another definition of appraisal value; It is defined as "the value of the company assets determined by the relevant experts by taking into account the age, capacity, technology, market value of similar assets".
An expert is the person whose opinion is sought because of his knowledge and expertise. The value reached in the determination of the fair value of the asset subject to valuation by experts is the appraisal value. Appraisal value for the company is the value to be obtained if fixed assets are disposed of at market prices. The appraisal value method does not take into account the firm's market situation, products or management skills. This method is used when more assets are sold.
Amortized Replacement Value (Revalued Net Asset Method)
The revalued equity valuation method is a method derived from the equity value method, and consists of the conversion of historical costs of assets into current values. The assets converted into current values are determined by the value of the business, and the value of the equity is determined by subtracting the debts from the assets. The main point that distinguishes the method from the equity (net asset) value method is the phenomenon of increasing the historical costs of assets to current values.
Dividend Yield Method
It is accepted that dividend distribution affects the value of stocks and the present value of the stock will be equal to the present value of the expected dividends.
TV == Dividend Paid Per Share / Market Value of Stocks
PO: stock value
DT: Dividend income expected
TV: Dividend yield.
Market Capitalization Value Method
The value found by multiplying the market value of the shares of companies whose shares are traded on the stock exchange and the number of shares is the market capitalization value (PKD).
Book Value Method
Book value (accounting value) is the value determined according to the accounting records of the assets registered with historical value at a certain date.
Arbitrage Pricing Model (APM)
In the Arbitrage Pricing Model, it is accepted that the security return is created by the factors in the sector and the market and there is a positive relationship between return and risk. These factors are variables such as gross national product, inflation, money supply, and interest. Unsystematic risk will decrease as the number of securities increases, but systematic risk will not change. The return of the security is expressed as the sum of the risk-free interest rate and the risks borne by the security according to variable factors.
Price / Earnings Ratio Method
Price / Earnings Ratio is how many TL of the investors in return for the net profit of the enterprise per 1 TL of stock. It is a rate that indicates that they are willing to pay.
“The price / earnings ratio is the ratio of the market price of a company stock to the net profit per share (or the market capitalization value of the company to its net profit after tax). For the company to be appraised, the company value is obtained by multiplying the company's own rate and / or the average of similar companies with the nominal value of the company shares. "
Price / Cash Flow Ratio Method
F / NA = Stock Market Price / Cash Flow Per Share
In other words, F / NA ratio;
F / NA = Stock Market Price / Cash Flow Per Share (Net Profit + Amortization)
Company Value = Average F / NA Ratio of the Selected Sector or Market * Company Cash Flow
Another definition of F / NA ratio is as follows: “It is a method that can benefit from the data of other companies while determining the value of a company. The Price / Cash Flow Ratio is the ratio of a company's share price in the market to the company's cash flow per share. With the data of the company to be compared, one or more ratios are determined and multiplied by the cash flow of the company to be appraised, a value or value range is reached. "