In spite of movements and messages to live simply, get back to basics, or slow down and smell the roses, the business world roars ahead at a breakneck pace. A six month old ipad is past its prime, and at least for now, a blackberry phone is considered Neanderthal. Cars plummet in value the instant they’re driven off the lot, and, not to date myself, but where are Ipana, Camay, Aqua Velva, and Tang?
The moral of the story is that yesterday’s success is yesterday’s success. Business doesn’t grow in the past, it grows in the future. Quite simply, to maintain and sustain growth, business leaders must think and act ahead of the curve. Just because you plan to sell or transition out of your business in the foreseeable future doesn’t mean you can coast. Indeed, this is the time to think and act strategically and position even more aggressively for tomorrow’s market.
The purchaser of your business is buying the future, not the past. A business which is strong and state of the art is far more attractive than one which has a great track record but an aging and dying market. Three dimensional printers are the future; fax machines are the past.
Take stock of your business. Where are you positioned? What are the trends, and how competitive will you be in tomorrow’s market? Competition is stiff. Stay ahead of the curve.
What are you selling, when you sell a business? A future income stream, a list of customers, inventory, receivables, equipment, processes and procedures, intellectual property? Take inventory. What in your business could possibly have value to potential buyers? Once you have your list, look at it critically. Are your customer lists up to date, with accurate information? How old is your inventory? How old are your receivables? Do you have your processes and procedures accurately and clearly documented? Do you have clear and transferable title to intellectual property? Small things can make a huge difference in the price you can command for your business.
Start early and maximize your assets. Clean up customer lists, taking the time to complete contact information and order history. Get and compare yourself to industry benchmark ratios for inventory turns, receivables and other indicators. Do what you need to meet and exceed benchmarks. Document processes and procedures so that anyone can understand and implement them. Research the transferability of your assets.
It’s your business to know about your business. If necessary, re-familiarize yourself with all aspects of the business and its financial underpinnings. If you don’t know the basic answers about your business, your have eroded your credibility with potential purchasers.
Finally, work to make every aspect of your business picture-book perfect. Homes on the market typically look uninhabited. Everything is clean, artfully arranged and looking like a glossy picture in a high-end magazine. Apply the same concept to your business. A pristine, organized environment sends a very different message that a chaotic, filthy workplace. Aim for the former, not the latter. Likewise work to have all aspects of your business, from your financial reports to procedure manuals, equally pristine.
You have one business to sell, and one opportunity to maximize your return. Take the time and take the steps to realize the true value of your invested time and labor.
For many businesses, maximizing profit is the unending quest. Profits translate into opportunities, security, and discretionary income. Maximizing profit also means boosting your return when you transition out of the business. Here are three quick ideas to help achieve growth to the bottom line:
1. Have a narrowly targeted market, and dominate it. You must be the best choice for your perfect client. What do you offer that is better than any of your competitors? You need to know and promote this.
2. Get your processes to run like clockwork. You can’t afford to waste time or money. As business grows, small inefficiencies can erupt into significant avoidable expenses.
3. Look to the future. What changes do you see in your market, in your industry and in the world at large? What impact will these have on your business? How can you strategically take advantage of change?
Dominate your market, work smart and look ahead. Act now to maximize the profitability of your business today, and the value of your business tomorrow.
Sales are critical to business. Without sales, you don’t have a business, you have an hobby (and sometimes, a very expensive hobby!) In the struggle over day-to-day sales and annual profit plans, it’s easy to lose sight of the biggest sale in the life of your business – the sale of the business itself.
“But I have no intention of selling!” you might be saying. Think again. At some time, you and your business will part company. You might liquidate the business, or bequeath it to your children, or turn it over to others, but regardless of the circumstances or the money involved, a “sale” or a “sale-like-event” will occur.
Like death and taxes, business transition is inevitable, and like death and taxes, business transition can be overwhelming. Whether you foresee a sale in the near future, or are intending to hold and grow your business for a longer term, now is the time to begin planning for the ultimate sale.
Looking toward the ultimate sale can have an impact on every aspect of your business today – from your positioning in the marketplace to your processes and structure and much more. Take steps now to maximize value and establish the operational basis for a smooth transition.
How marketable is your business right now? Would it fetch what it is truly worth? How much of the business is dependent on you, personally? In future postings we’ll explore simple, practical ways to build a business to sell a business.
It’s less than two weeks to the BIG DAY for florists, jewelers, chocolate companies, fancy restaurants and many other retailers. Be sure to remember your personal Valentine, and patronize your preferred selection of consumer-oriented businesses.
But Valentine’s Day can be more. Take the opportunity to be a Business Valentine. Let your customers, staff, vendors and others know you appreciate them. A simple note or a sincere “Thank you” goes a long way toward building genuine relationships. We tend to remember those around us at Christmas, but let people know you appreciate them even after New Years Day has passed.
Winter is here; the holidays are over. Some businesses are picking up, slowly or substantially; others are in hibernation, or worse, in the activity deep freeze. Regardless of your business status, don’t miss the opportunities to forge ahead, right now.
- Take stock of last year’s successes. Who were your big customers? What did you sell to them? How did they find you? What closed the sale? Look for similar customers to repeat success.
- Take another look at last year’s customers. How can you continue to serve them? What other products can you offer? Can you offer ongoing services? Work continuously to keep their loyalty, because every competitor is constantly seeking to lure them away.
- Focus your offering. Being everything to everyone is being nothing to anyone. For what specific customer are you the single best choice? Why should they buy from you and not a competitor? If you don’t know the answer neither will they. To make an impact, you must be the best, target the customer and communicate to them.
- Step back and envision tomorrow; it will be here before you can blink. Where is your market going? What resources do you have? What can you create to serve the market with a new product that meets their needs better than anything else? Be creative.
- Get into action. Don’t waste time while your competitors are surging ahead. Get moving. Try something. Invest in your business. The longer you delay, the more likely your competitors will seize the advantage, and the less time you have to make this year’s profit plan. Get the help you need to move wisely and quickly. Take action, assess results, make adjustments and try again.
The new year poses tremendous opportunities for those who act, and tremendous risks for those who do not. The market belongs to the quick and wise. Step into 2013 and take charge of business growth!