Goodwill as a Part of Marketing Strategy in Construction Companies in the Czech Republic

Abstract

Goodwill indicates the value of the intangible assets of a company, such as good customer relationships, company brand name, or experienced employees. It reflects the market position of the company, quality and, above all, tradition. The quality and longevity of their products reflect the desirable reputation in the eyes of consumers. Goodwill can be distinguished in two ways: purchased and inherent. The purchased goodwill is created by the company's activities. However, it is not reported in the company accounting because it is not reliably measurable. The value of the inherent goodwill can be quantified as the difference between the purchase price and the book value of the company being purchased. Its recognition is mainly applied in mergers and acquisitions. However, its accurate and reliable quantification is relatively difficult. The value of a company can be affected by economic changes through business policy influenced by marketing strategy. The presented article examines the value of the purchased Goodwill and the company's marketing strategy focused primarily on the construction industry.Goodwill indicates the value of the intangible assets of a company, such as good customer relationships, company brand name, or experienced employees. It reflects the market position of the company, quality and, above all, tradition. The quality and longevity of their products reflect the desirable reputation in the eyes of consumers. Goodwill can be distinguished in two ways: purchased and inherent. The purchased goodwill is created by the company's activities. However, it is not reported in the company accounting because it is not reliably measurable. The value of the inherent goodwill can be quantified as the difference between the purchase price and the book value of the company being purchased. Its recognition is mainly applied in mergers and acquisitions. However, its accurate and reliable quantification is relatively difficult. The value of a company can be affected by economic changes through business policy influenced by marketing strategy. The presented article examines the value of the purchased Goodwill and the company's marketing strategy focused primarily on the construction industry.