Now is the Time for Focus

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As of late April 2020, there is one thought at the forefront of the vast majority of businesses around the globe, namely, what steps do I need to take to stay in business until the COVID-19 pandemic is over or recedes?  There is no doubt about it, this is the “big question” of the day. 

The global economic structure hasn’t seen this much uncertainty since WWII, and some would argue that we’ve never seen this level of simultaneous global economic disruption.  Knowing what steps you need to take to keep your business up and running is of paramount importance. 

In short, business owners must be sure that their businesses are in good shape.  You should take every step possible to position yourself for when the economy is back up and running at full steam.  Right now, there is a degree of chaos and uncertainty, but this will not last.  As a business owner, you need to focus on getting your house in order.

Now is not a time to take a vacation.  Instead, you should be focused like never before on the inner workings of your business.  You should be striving to find ways to improve every single aspect.  Of course, this is easier said than done.  There is a real psychological hurdle, as for many people it seems as though everything has “stopped.”  While customers, clients, and staff interactions have been dramatically reduced, now is not the time for you to “check out” mentally and wait for things to get better.

Rarely, if ever, has it been more important for owners to invest as much of their time and energy as possible.  After all, as a business owner, you have already shown a great deal of drive and determination, as well as at least some level of out of the box thinking.  You have proven that you have what it takes to get through the recent challenges. 

Many will feel dejected right now.  But you should pool on the same skill sets that allowed you to create a successful business in the first place.  What obstacles did you overcome in life to create your business?  Was your business created during a prior economic downturn?  The odds are that you already have skill sets and strengths that will allow you to survive the fallout of COVID-19.

For business owners who truly want to survive the economic stress of the pandemic, ultimately, focus is key to survival.  The odds are excellent that there are revenue streams and different approaches that may have been overlooked.  Your job is to identify and then exploit those avenues.

Copyright: Business Brokerage Press, Inc.

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Questions for Helping Businesses Survive the COVID

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Developing Your 90-Day Plan

Those who want to make sure their businesses survive this pandemic will want to achieve a laser-like focus.  It is important to realize that the forced downtime triggered by the pandemic affords you the opportunity to work on potentially neglected aspects of your business. 

Summed up another way, now is the time for dynamic and focused action.  In this article, we’ll address what you can do to help your business survive this unusual time period. 

Reevaluating Your Business

It’s time to step back and look at every aspect of your business, including your processes.  You should be encouraged to find new ways of doing things.  In short, now should be viewed as a time of opportunity to reboot your business.  That way when the pandemic has subsided, and your business picks up once more, it is more efficient, more effective, and more competitive.

Scott Bushkie, Founder and President of Cornerstone Business Services, recommended that business owners create 90-day plans where they look for ways to innovate.  This strategic plan should focus on what they are going to do and what they want to accomplish.  It is critical that there is an actual plan that achieves tangible results and not simply a list of things that should be accomplished.  Listed below are a few questions you should be pondering.

  1. How can I outperform the competition?
  2. How can I innovate?
  3. How can I increase my use of technology?
  4. How can I deliver my products and services in a different way?
  5. How can I reduce my operational costs?
  6. Have I reached out to my suppliers and creditors for assistance?
  7. Have I applied to applicable SBA COVID-19 focused programs?
  8. What do I want to accomplish in the next 90-days? 

It’s Time to Reboot

The main point is that businesses should not look at this pandemic situation as some sort of “miserable and stressful vacation,” but instead as an opportunity to reboot what is not working, and look for ways to make improvements in every aspect of your business.  This process begins by asking the right questions and striving to find the answers.

In answering these questions and finding ways to help boost your rates of survival, you should turn to every asset at your disposal.  Why not ask your management team as well as all of your employees for ideas that could help their business?  Everyone should understand that owners are looking for ways to keep their business healthy while navigating the pandemic.

Now is the time for reflection, short-term and long-term planning, and tangible actions.  Business owners should also consult with a range of business professionals, including, of course, business brokers and M&A Advisors.  Brokers are uniquely positioned to help business owners through this crisis.

Copyright: Business Brokerage Press, Inc.

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6 Tips and 90 Days to Protect Your Business

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There can be no way around it, Inc. contributor Brian Hamilton’s April 2020 COVID-19 centered article, “6 Actions to Take in the Next 90 Days to Save Your Business,” isn’t pulling any punches.  Hamilton, Founder of the Brian Hamilton Foundation, believes that the next 90-days could be make or break days for business owners looking to navigate the choppy waters of the COVID-19 pandemic.  His latest Inc. article provides readers with 6 actions they should take now to survive the economic fallout of the COVID-19 pandemic. 

Tip #1 Vigorously Control What You Can

Hamilton’s first tip is to “Vigorously control what you can.  Vigorously ignore what you can’t control.”  As Hamilton points out, you can’t control the economy; instead, you need to focus on what you can control.  His view is that there has never been a more important time to focus, “More than ever, you’ll need to go to war with things within your control.”  Now is the time to exercise control.

Tip #2 Guard Morale

During tough economic times, employee morale can be a real issue.  This brings us to Hamilton’s second point, “guard employee morale.”  Significant drops in employee morale can lead to serious problems with your business, which is exactly what you don’t want to see right now.  Hamilton notes that you have to be the general that helps his or her troops rise above potential panic.

Tip #3 Preserve Cash

Hamilton’s third tip is to “preserve cash where you can.”  He states, “Right now, your motto should be: Live to fight another day.”  The pandemic means that you need to keep expenses down and watch every dollar.  No one knows what the next few months, or the next couple of years, could have in store.

Tip #4 Be First in Line

“Be first in line,” is Hamilton’s fourth point.  Hamilton wisely pushes business owners to be the first in line for government assistance.  This is very good advice, as SBA and other funds are likely to be limited.

Tip #5 Get Back to the Basics

Fifth, Hamilton recommends, “Get back to the basics…starting with monomaniacal customer service.”  As always, customers, whether existing or new, are the lifeblood of your business.  You can’t afford to lose customers now and for this reason, you need to have a laser-like focus on customer service. 

Tip #6 Pivot your Product or Service 

Hamilton’s sixth tip is to “Pivot your product or service to new conditions.”  Small changes to your business can open up new streams of revenue.  Even if these streams of revenue are comparatively small, they could mean the difference between sink or swim!  Try to step back and look at your business with fresh eyes and strive to find ways to offer something new to your customers.  Whatever you offer should be based on your existing goods and services and not require a new, large expenditure.

The COVID-19 pandemic is obviously disruptive, but it won’t last forever.  Hamilton’s advice of focusing intensely on the next 90 days is sound advice.  You won’t regret looking for ways to safeguard your business for the next 3 months.

Copyright: Business Brokerage Press, Inc.

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Don’t Fear Failure, Learn from It Instead

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Failure is rarely fun.  But it is also a key ingredient in success.  While failure can be painful, there is no doubting the fact that the lessons that come from failure can be powerful teachers that provide life-long lessons and even life-trajectory altering results.  Summed up another way, failure hurts.  But on occasion, not failing could hurt more, especially in the long run.

In her Inc. article, “Why Tons of Failure Is the Key to Success, According to Seth Godin,” author Sonia Thompson, CEO of Thompson Media Group, points out that most people “avoid failure like the plague.”  Instead, they spend their time trying to achieve perfection.  In the process of adopting this approach, people miss all kinds of opportunities because they are afraid of damaging their egos.  Embracing failure is a way to experience many “transformational benefits,” which would never be experienced without the lessons of failure.

Thompson points to the work of 18-time best-selling author Seth Godin who has written about how entrepreneurs who fail more often perform at a higher level.  She quotes Godin as follows, “The rule is simple.  The person who fails the most will win.  If I fail more than you do, I will win.  Because in order to keep failing, you’ve got to be good enough to keep playing.”  Godin continues that failure imparts a gift of sorts in that it teaches us how to distinguish between a good idea and a bad idea.

As Thompson notes, research supports the notion that if you want a breakthrough idea, you will need to “produce an enormous volume of ideas.”  Obviously, most ideas won’t work, but that isn’t the issue.  The issue is to work your way through the bad ideas to get to the winners.  Sure, it would be great to have nothing but winners.  But life and reality don’t work that way.  Failure should be seen more as a path forward than the end of the road.

Getting comfortable with failure, in Thompson’s view, is critically important.  She believes entrepreneurs should take steps that make them more comfortable with failure, such as detaching oneself from the results. 

It is vital to remember that you are not the work.  In contrast, the work is part of an ongoing process.  Getting good at something takes time, and there will be failures.  For this reason, entrepreneurs simply must embrace a “growth mindset.”  Don’t think of failure as failure, but instead as part of a learning process.  There is no denying that this approach will make you calmer and that, in turn, may help you make better decisions.

There will be failure in life.  There will be problems and there will be obstacles.  Much will happen that you can’t predict, manage or control, such as the COVID-19 outbreak.  The trick is to focus on what you can control and move forward without a paralyzing fear of failure.  Because in the end, failure may be one of your best tools.

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How to Connect During a Crisis

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Small business owners are facing new challenges during this crisis.  Communicating with customers requires more focus and depth than ever before.  In Mat Zuker’s latest article for Forbes Magazine, he cites Jay Mandel who runs The Collective NYC, a marketing consulting team focusing on a customer’s experience, who underlines the importance of businesses to understand their mission statement and values in order to re-enforce marketing strategies. 

Information is Crucial.  Each customer purveying your business’s website needs to understand your hours of operation, any limitations to service and what is being done to ensure cleanliness.  Providing this information establishes to your customer your seriousness of precautions which will be appreciated during this time.

If your financial situation allows, focus on your employees, donate to charities or offer discounted or free products.  By marketing this information, your brand’s scope will bolster with the customer as well. 

Utilizing the Customer’s Time.  Most customers are adhering to social distancing guidelines put forth by their state and the federal government.  Now, more than ever, it is important to exhibit to your customers how your brand can be utilized beyond your brick and mortar.  Zuker cites how universities are beginning to offer free online classes and telecommunication companies are offering two months of free service to low-income families; King Arthur flour is promoting its library of comfort food recipes (yes, please!).  Thinking beyond your storefront to put your service or product into your customer’s virtual hands is important.

Remember to entertain.  By each passing day, customers are looking for new stimulation to help the time go by at home.  Movie companies are making the best of the situation by sending theatrical releases to online streaming services.  We don’t think it is necessary to always make your customers laugh, but it might be within your branding to aim for content geared towards warmth, humanity and empathy. 

The metric for engaging your customers is changing; moving beyond views and shares to quality feedback or social impact on your community.  Do not bite off more than you can chew.  Cited in Zuker’s article, Social Media Today warns of virtue signaling; meaning declaring a set of values, but not following through on the actual deeds. 

Also, this is a fantastic opportunity to consider your marketing strategies for when this crisis ends.  What will your business look like once you are able to open the doors?  How are you able to stay relevant with your competitors?  These are all questions needing answers, but today we must do our best to accomplish what is in front of us. 

Read Mat Zucker’s full article here: https://www.forbes.com/sites/matzucker/2020/04/01/content-in-a-crisiswhat-brands-can-deliver/

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Great Tips for Selling Your Business

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It takes preparation and focus to sell most businesses.  The reality of the situation is that it can take years to achieve this goal.  Partnering with a business broker or M&A Advisor is a smart step towards selling any business, as these pros know the very best tips.  In that spirit, let’s take a look at some great tips for selling your business.

Getting your business ready to sell means carefully evaluating the foundation.  Any significant problem can send buyers “running for the hills,” so be sure that you work out any problems well before placing your business on the market.  If you have any litigation or environmental issues, you most definitely want to address those issues before it is time to sell.  Nothing will scare away prospective buyers quicker than pending litigation or the specter of a potentially costly environmental clean-up.

A second key issue you’ll want to address is determining who exactly has the legal authority to sell the business.  If a board of directors or majority stockholder situation is in place, then selling a business can become more complex than it would be if you were dealing with a sole proprietorship or partnership.  Again, the last thing you want is for “legal surprises” to occur when you get ready to sell a business.

If you have non-negotiable items, be certain that those items are discussed upfront.  Revealing your non-negotiable items at the very beginning of negotiations will save everyone involved a great deal of trouble.

Tip three involves maintaining a flexible mindset.  In most circumstances, you simply can’t have everything that you want.  Both buyers and sellers need to be flexible.  Sellers will want to be flexible about any real estate.  Buyers may not want real estate associated with a given business, and you need to be prepared for this.  Sellers should also be prepared to accept valuation multiples for lack of management depth and other factors, such as reliance on a small number of customers.

At the end of the day, sellers should partner with experienced professionals such as attorneys and business brokers.  You’ve put a lot of time, energy and resources into building your business.  When it comes time to sell, it is only prudent to put together the best team in order to achieve optimal results.

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Should You Sell Your Family Business?

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When the complicating variable of family is added to the equation of selling a business, the situation can get rather messy.  Family usually complicates everything and businesses are, of course, no exception.  Ken McCracken’s recent article “Family business: to sell or not to sell?” 6 questions to help you make the right decision,” seeks to decode the complexities so often associated with family businesses. 

Consider the Market 

The foundation of determining whether or not now is the right time to sell must begin with market forces.  Determining how much your business is worth is a key variable in any decision to sell. 

The best way to determine the worth of your business is to have an outside party, such as a business broker, evaluate your business.  What you believe your business to be worth and what the market dictates could be very different.  You may discover that your business does not have the value that you hoped for.  If this is the situation, then selling simply may not be an option.

What is Next for You?

Tied to knowing your market value is understanding what you will do next after you sell your business.  For example, do you have a family member who can run the business without you?  What will you and any family members who work for the business do after the sale goes through?  You may discover that the sale could be very disruptive for you personally.  All too often, people fail to recognize the emotional and mental stress that comes along with selling a business.  Many owners begin the selling process only to discover that they are not emotionally ready to do so.  While everyone wants to be unemotional in making their business decisions, this is not always the case.

Due Diligence 

You will also need to deal with the issue of due diligence.  Working with a business broker is an excellent way to handle the due diligence process.  Business brokers usually vet prospective buyers ahead of time, which can save you a great deal of aggravation and wasted time. 

McCracken believes business owners should investigate how the prospective buyer handled previous acquisitions.  Specifically, McCracken believes that business owners should look to how well the prospective buyer honored previous commitments, as doing so is an indicator of how trustworthy a buyer may be. 

Planning for Negotiations

Finally, McCraken believes it is essential to know who will oversee negotiations.  It is key to note that many deals that could have otherwise been successful, fall apart due to poor negotiations.  A business broker can be invaluable in negotiations.  After all, who wouldn’t want someone with dozens, or even hundreds, of successful transactions advising them?

Selling a family business can be emotionally charged and can cause significant life changes for not just you, but for members of your family as well.  Often, family businesses were built up over a lifetime or even over generations, which can make the decision to sell quite emotionally charged.

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Why You Should Focus on Proper Exit Planning

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If you are like many business owners, you are primarily focusing on building your business.  Yet, as we’ve covered here many times before, you should start thinking about what you’ll need to do to sell your business before you even officially launch.  Many businesses can take years to sell or even fail to sell all together.  For this and many other reasons, it is important to invest some time and energy into thinking about proper exit planning and strategies. 

Walker Deibel’s recent Forbes article, “How Proper Exit Planning Benefits the Buyer and Seller,” Deibel discusses his interview with Exit Planning: The Definitive Guide, author John H. Brown. Brown and Deibel both agreed that, when properly handled, exit planning can help both the seller and the buyer. 

Exit planning can make a business more transferable.  As Deibel points out, when buyers are evaluating businesses, transferability is a key factor.  A buyer must feel that he or she can walk into a business, take it over, keep it running effectively and even grow the business in the future. 

A key aspect of being able to buy a business and having that business be successful is that all relationships from vendors to customers are transferable.  A good management team, one that can step in and help a new owner thrive, is a must.  Building that team in advance is a savvy move for any business owner looking to sell his or her business.  Concerns on any of these fronts can spell doom for a seller.  If a buyer doesn’t feel that they can operate a business, then they probably shouldn’t be buying it.

Great exit planning most definitely benefits the seller as well.  As Deibel notes, when sellers engage in exit planning, they realize how much money they need in order to exit.  In turn, this forces sellers to become very focused and goal-oriented.  Sellers will take proactive steps to ensure that their business is as appealing to a potential buyer as possible.

Ultimately, proper exit planning is a win-win, one that benefits both buyer and seller.  Exit planning can provide sellers with much-needed clarity while simultaneously lowering the overall risk that sellers face.

Buying or selling a business is a multifaceted, and often quite complex, process.  The sooner you begin working with a professional, like a business broker, the better off you’ll be in finding the right business for you and your particular needs.  For most people, buying or selling a business is the financial decision of a lifetime.  Having a proven trusted partner, one that knows the lay of the land, is simply invaluable.

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The Top Ways to Create an Attention-Grabbing Sales Ad to Sell Your Business

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A major part of selling your business is getting the word out.  After all, the more people that know your business is for sale, the better off you’ll be.  In Bob House’s recent article, “How to Create an Effective Business for Sale Ad and Ensure It Gets the Best Result,” House gives readers an assortment of tips that he believes will help sellers attract higher offers from real buyers.

Getting the Word Out

As House wisely points out, many buyers wait until the last second to dive in and create a good sales ad.  In fact, many buyers fail to grasp the real importance of creating a quality and compelling advertisement.  Imagine creating a good sales ad like you would going fishing with a group of friends.  The more friends you have on your fishing trip, the greater the odds that someone catches a fish.  In much the same way, the more people who know you are selling your business, the greater the chances that you’ll get some serious “bites.”

Tips for Receiving More Attention 

House has five key tips for attracting more attention from prospective buyers via your sales ad.  At the top of the list is to be descriptive.  Your sales ad should give an excellent description of your business and its unique features.  As House notes, you want to “paint a clear picture.”  In other words, now is not the time for mystery.  You want prospective buyers to have a very clear idea of what kind of business they could possibly buy.

Headlines Count

Secondly, you should have a great headline.  People have always skimmed, but the rise of the Internet has taken skimming to a whole new level.  Your sales ad should have a very engaging and interesting headline.  You want to capture people’s attention.  A good place to start is by determining what your business’s best feature is and emphasizing that feature in your headline.

Incorporate Top-Notch Images

Third, the old saying that a picture is worth a thousand words absolutely applies to selling a business.  Just as a great headline will capture people’s attention, the same holds true for a great picture.  Consider having a professional photographer take the photo, as he or she may have tips to make your business look its best that you may simply not know.

Your Financials

Fourth, your ad should definitely include key financials.  Any serious buyer will be very concerned, if not obsessed, with your financials.  Information such as cash flow and income statements are a good idea as may potential buyers focus their business searches around key financial metrics.

Don’t Forget the Final Step

Finally, if there has ever been a time in your life to proofread, this is the time.  In fact, you should consider hiring a proofreader to look over your ad for grammar and spelling mistakes.  As House notes, you want prospective buyers to realize that you are attention oriented and responsible.  A simple grammar or spelling mistake could wreck a potential deal.

Creating a great sales ad is an art form.  One of the best ways to ensure that you have a great sales ad is to work with an experienced business broker.  Business brokers know what buyers are looking for, have great marketing professionals at their disposal, and can help you frame your business in the best light possible.

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What Do You Need to Do to Get Your Business Ready to Sell?

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In his recent article in Smart Business entitled, “How to get your business, and yourself, ready for sale,” author Adam Burroughs explores the key points of getting your business ready to sell.  Burroughs points to the truism that, at some point, almost every business owner must sell his or her business.  For this reason, it is critical to think about what it takes to get your business ready to sell.  Simply stated, it is best to explore and plan for selling your business long before you actually need to place your business on the market.  Let’s explore some key points for selling your business.

Broadening Your Options

Burroughs interviews Scott McRill at Clark Schaefer Hackett.  McRill notes, “The sooner you think about your exit, the more options you’ll have for yourself and the business when the time comes.”  A savvy business owner will always want to give himself or herself as many options as possible. McRill wisely points out that early planning is key, and a failure to engage in early planning could lead to a lower selling price.  If you want to get the best price for your business, then planning for the eventual sale as far in advance as possible is a good move.

Planning in Advance

According to Burroughs, business owners should start planning to sell their business at least 2 to 3 years before they actually plan to sell.  Part of the reason for this is so that business owners will have enough time to make operational improvements designed to maximize the business’s overall value. 

A Financial Review

At the top of every business owners “preparing to sell” list is to have a third-party review the business’s financial situation.  This is excellent advice for, as frequent readers of this blog know, any serious prospective buyer will look long and hard at your business’s financials.  Getting your business’s financial house in order means that you should turn to an accounting firm for help.  You’ll want to review financial statements for at least the previous 2 to 3 years.

Burroughs points out that when it comes to selling a business, there are many variables that business owners often overlook.  At the top of the list is the management team. 

Your Management Team

Prospective buyers can get very nervous about the stability of the management team once ownership has changed hands.  Often, the new buyer may only sign on the dotted line if the owner agrees to stay on after the sale during a transition period.  Having a competent and proven team in place, one that is dedicated to staying with the company will help you get your business ready to sell.

There are a lot of variables involved in preparing to sell a business.  The sooner that you get experts involved in the process, the better off you will be.  A business broker can serve as a guide – one that can point you in the right direction.  Find a broker with an abundance of experience, and you’ll have an invaluable ally who can help you navigate the process.  It can take a lot of time and effort to sell a business.  Working with a business broker can keep you from reinventing the wheel at every step of the process.

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