What Makes Your Business Value Grow?
24 March 10For many people, their business is one of their biggest assets. For others, they want to build it up so that the business can support their family into the future – whether they sell the business or earn income for the business. So what do you need to concentrate on to optimise the value of your business?
1. Growth – implement well defined business strategies and goals by formulating a growth plan which includes product and service development, marketing and building of alliances
2. Cashflow – improve WIP and debtor recovery by introducing performance standards, progressive billing and debt collection procedures.
3. Systems – Document processes and have up to date relevant technology.
4. Staff – Improve retention, staff attraction and performance. Introduce performance based incentive agreements, implement personal development programs and leadership training. Get the right team around you.
5. Client Retention – review client services and referrals. Update and utilise Client Relationship Management Systems
6. Non reliance on owner – structure the business so that it becomes less reliant on you.
It is common that business owners have unrealistic expectations about the value of their business. They often haven’t focused on the above areas and have not spent enough time working on the business. You don’t need to be a big business to cover off on these areas. You can implement many things that do not cost a lot, but make a huge impact on your business.
The first step is to evaluate where your business currently is situated. If you need assistance, talk to your business advisor or accountant. (If you have over 10 full time equivalent employees, you may be eligible for the government’s Jobs Assist Grant to obtain advice to identify these areas.) Your business advisor can provide an action plan to help you get started in working on improving these area’s of the business.
Don’t be overwhelmed on what to work on first. Establish a project plan and get the team involved to help work on each item.
Don’t forget to monitor the results. It is great to look back and see how well you and your team have done. It only takes small steps to make a difference. If you aim to improve by 1% per day, you will be twice as good in 71 days!