For many business owners August is the time to take a vacation, as well as a time to reflect on this year’s achievements and to set goals for the year ahead.
Most business owners will set goals to hit certain revenue or profit objectives. But if your goal is to own a more valuable /saleable business, consider adding one or more of the following goals:
- Get your Sellability Score. All goals start with a benchmark of where you’re at today, and by understanding your company’s Sellability Score, you can pinpoint how you’re doing now and which areas of your business are dragging down your company’s value. (Follow this link to the 13-minute survey: lmaallc.com/sellers)
- Companies that can perform well without their owner are more likely to get an offer to be acquired when compared to more owner-dependent businesses. So consider taking a two-week vacation without checking in with the office, to see how well the business performs without your daily intervention. When you return, you’ll see how well your company performed and where you need to make a key hire, create a new system, or delegate more authority.
- Document at least one process per month. You know you need to document your key systems and procedures, but you may be overwhelmed by the task of taking what’s inside your head and putting it down in writing for others to follow. Commit to documenting one system a month and within a year you’ll own a more sellable company.
- If you’re like most business owners, you’re still your company’s best salesperson, but this can be a liability in the eyes of an acquirer. By the time you sell, none of your key customers should think of you as their primary point of contact. Commit to offloading at least one customer relationship going into 2015.
- Check your contracts and make sure they would survive the change of ownership of your company. If not, talk to your lawyer about adding a line to your agreements that states the obligations of the contract “surviving” in the event of a change of ownership of your company.
- Find your lease (and any other key contracts). When it comes time to sell your company, a buyer will want to see your lease and understand your obligations to your landlord. Having your lease handy can save time and avoid any nasty surprises at the eleventh hour in the process of selling your company.
Instead of just building a bigger company, also consider making this the year you build a more valuable /saleable one.
If you know of a business owner who’s thinking of selling or buying a business and who might benefit from a free, confidential, consultation with us, have them contact me at: firstname.lastname@example.org
By: Mike Ertel, Transworld M&A Advisors