If you missed any of our past newsletters they can be found by using this link. Every month we talk about ways to improve your business, your sales, and your networking skills - things you can do today to improve your results.
If you are ready to join the ranks of business owners committed to growing their business and enjoying life more, sign up to attend a workshop or call Dave Ferguson at 847-968-2468 to arrange a complimentary consultation.
October 2009 - Of Course It's For Sale
By Dave Ferguson
I sent a friend who was interested in owning a business to visit a shop in town. I had told her the owner had just bought the place and had done a really good job of getting more customers into the store.When I saw my friend the next day she told me she had visited the store and was surprised to hear the new owner say she wanted to sell it. I was surprised to hear that, so when I was in town a couple of days later I made a point of talking to the owner. She remembered my friend and all her questions. "That woman was so interested in the shop I asked her if she wanted to buy it." She went on to explain, "It's a business. It should always be for sale - for the right price."
Many business owners become so emotionally attached to their business that they don't consider selling until it's too late. If someone asked you to name a price for your business what would that price be?
Many entrepreneurs start businesses planning to sell them within a few years. Others just struggle to actually become the owner of the business instead of its only employee - if you thought working for someone else was bad, try working for yourself!
To be the business owner is to think of your business as an asset, something like a car or a house that can be sold on the open market. What gives the business value is its assets and the ability to generate positive cash flow.
No matter how you feel about your business, we can calculate what it's worth. For example, most business brokers will probably tell you that a typical business is worth 1.5 to 3.5 times discretionary cash flow plus the value of the tangible assets. In this case, discretionary cash flow is total cash flow plus the expenses that a new owner would not be obligated to pay - depreciation,owner's salary, auto expenses, loan payments, retirement contribution, travel and entertainment, etc.
Do you know what your business is worth? If not, how would you know what to say if someone offers you a million dollars cash for yours?
Focus on Sales
Remember, it's not what you believe about your product or service, it's what your customers believe that counts. No matter how powerful your message or airtight your logic, unless you understand what your customers want and need you won't win them over. You can lead a horse to water but you can't make him drink. Your job is to make him thirsty.
Networking Tips
Networking should be part, and only part, of your marketing plan. Take the time to figure out where your customers do come from and where they should be coming from. Use that information to develop an overall plan and the individual strategies that address those needs.