Where to start, when your business growth stops
By · CommentsWhy would two companies in the same industry, with the same financial performance, command vastly different valuations? The answer often comes down to how much each business is likely to grow in the future.
The problem is that a lot of successful businesses reach a point where their growth starts to slow as the company matures. In fact, the price of doing a great job carving out a unique niche is that the specialty that made you successful can start to hold you back.
If you make the world’s greatest $5,000 wine fridge, you may have a successful, profitable business until you run out of people willing to spend $5,000 to keep their wine cool.
Demonstrating how your business is likely to grow in the future is one of the keys to driving a premium price for your company when it comes time to sell. To brainstorm how to grow beyond the niche that got you started, consider the Ansoff Matrix. It was first published in the Harvard Business Review in 1957 but remains a helpful framework for business owners today. Read More→
Tweet
9 Warning Signs You’re a Bad Business Owner
By · CommentsBy Trista Perot and John Warrilou, author of Built to Sell.
Freewheel hub converted to fixed geat hub, also spoke cards in spokes. (Photo credit: Wikipedia)
Are you what’s called a “Hub and Spoke” Business Owner? If you were to draw a picture that visually represents your role in your business, what would it look like? Are you at the top of a traditional Christmas-tree-like organizational chart, or are you stuck in the middle of your business, like a hub in a bicycle wheel?
As anyone who has tried to fly United when O’Hare has been hit by a snowstorm knows, a hub-and-spoke model is only as strong as the hub. The moment the hub is overwhelmed, the entire system fails. Acquirers generally avoid hub-and-spoke managed businesses because they understand the dangers of buying a company too dependent on the owner. Here’s a list of nine warning signs you’re a hub-and-spoke owner and some suggestions for pulling yourself out of the middle of your business:
1. You sign all of the checks
Most business owners sign the checks, but what happens if you’re away for a couple of days and an important supplier needs to be paid? Consider giving an employee signing authority for checks up to an amount you’re comfortable with, and then change the mailing address on your bank statements so they are mailed to your home (not the office). That way, you can review all signed checks and make sure the privilege isn’t being abused. Read More→
TweetNegotiation when selling a business
By · CommentsOn June 1, 2011, both Floyd’s Coffee Shops in Portland, Oregon were busier than usual. The regulars were elbowed out of the way by new customers visiting the store for the first time to redeem their coupon and get $10 worth of coffee for $3.
This tempting offer was made because Floyd’s had been picked as the first-ever Google Offers “deal.” Google Offers is the company’s first baby step into the world of “social buying” style promotions where a special, limited
Image via CrunchBase
time offer is made by a business hoping that the deal will spread virally and thereby introduce a new legion of customers to their business.
Google, of course, did not invent the deal-of-the-day category; they were goaded into it after their generous $6 billion dollar offer to buy Groupon was turned down.
Now Groupon is starting to feel the pinch after thumbing their nose at one of the world’s most valuable companies. According to compete.com, Groupon’s traffic went from 33.7 million unique visitors in June 2011 to just 18.3 million unique visitors in January 2012. That’s a drop of almost half inside less than a year. Not surprisingly, Groupon’s stock is also down around 25% since its IPO last year. Read More→
TweetTesting and Certification Laboratory Business for Sale
By · CommentsWe are selling a testing and certification laboratory business that includes the real estate in the asking price. This company tests and certifies products for plumbing manufacturers, metal fabrication companies, cities and municipalities, chemical companies and many others. They can perform environmental, pressure, chemical, corrosion, x-ray, hydrostatic, hardness, tensile strength and many other types of test and certifications.
- Asking Price: $1,200,000
- Gross Revenue: $367,778
- Cash Flow: $197,165
- Value of Equipment: $365,000 (included in asking price)
- Value of Real Estate: $500,000 (included in asking price)
- Seller Financing: Negotiable
- Year Established: 1970
- Number of Employees: 3FT/2PT
- Picture taken from Google.com images
This company has procedure manuals for each of the tests they customarily perform. The seller is willing to provide training to the buyer on operations and testing procedures. The owner is selling for retirement. The ideal buyer would have engineering or manufacturing background also it would be helpful if there is a little background in marketing and advertising to push the growth. All of the business comes from repeat customers and word of mouth, as there are other companies that do similar testing.
This offering is structured as an asset sale. This is neither an offer nor a solicitation to sell securities. Real Estate Brokerage License on file. For more information please contact Trista Perot at 469-293-1397.
