Erik Twohig , May 24, 2017
Takeaway: Follow these steps if you realize your business value is not where you want it to be.
Eric Gall: We have programs and consultants available to assist you in bridging the gaps.
Many business owners realize too late that the value of their business is not what they need to meet their retirement goals/financial objectives.
Evaluate the Timing
- If you must sell, then you will need to adjust your objectives to to accept a lower price.
- If you have three to five years prior to the sale, you have time to grow the business and improve processes.
Find Help
- There are business consultants who specialize in business growth and preparing a business for sale.
- Of course, you the owner, must have the skills, discipline, time, focus and determination to help plan and execute the strategy.
- The strategy starts with a "Needs Assessment" that is the basis of the growth and process improvement roadmap.
- Process improvements may include building, training, documenting, reviewing and improving systems around quality, safety, communications, human resources, production, maintenance, sales, logistics, etc.
Identify Value Drivers
- Clean and accurate financial information.
- Sales history is trending upwards and not at the expense of margins.
- You have "barriers to entry" that give you a competitive advantage.
- You, the owner, are the strategist and visionary, but not required for day-to-day operations.
- You have systems and documentation throughout your business to help your staff meet operational objectives.
Baby Steps
For companies less than $2 to $3 million in revenue it may be too costly to afford a consultant; however, it is never too early to start working on improving the key value drivers.
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