Maximize the Value of Your Business in 5 Steps

With a background in banking, A business motivational speaker creates value for entrepreneurs by supporting and implementing with their management team the internationally recognized growth management methodology, Scaling Up, by facilitating the execution of strategies with the Talents, with continuous and agile rhythm.

If you think big for your business for a long time to come or if you want to sell it in the short, medium, or long term, you have every advantage in maximizing your value:

Do you know how to maximize the value of your business? By optimizing what creates the most value.

What you need to do to increase the value of your business is also what will make it more efficient, profitable, and attractive. By laying a solid foundation, your business will have the ability to seize opportunities that will fuel its growth. However, these levers must be well understood. Here is the five-step process I use to help my clients achieve this.

Step 1: analysis

Before doing anything, one must have a clear idea of ​​the current situation of the company. Are we ahead or catching up?

We must also look closely at the figures: ultimately, the value of the company is measured on the basis of its profits, that is to say, the net flows it generates. What a buyer pays for is the company’s ability to generate flows.

At the analysis stage, you also have to think about the company’s marketing positioning, which is part of its appeal. Does your company succeed in differentiating itself from its competitors? There is also the brand image, intimately linked to positioning, which constitutes an intangible asset central to the creation of value.

Finally, you have to take a close look at the company’s financial structure. Could it grow by relying on its own cash flow, without increasing its indebtedness? Does it have the financial capacity required to seize new business opportunities?

Step 2: mobilizing your team

You will need input from your team to successfully optimize the value of your business. To obtain their active participation and commitment, it is essential to carry out a mobilizing exercise of strategic reflection.

This exercise makes it possible to identify the elements having a significant impact on the valuation levers, such as cash flow, profitability, diversification of customers and suppliers, as well as the creation of recurring income. These have a direct link with the valuation multiple used when selling.

Whether you want to sell your business or simply increase its profitability, you need to give yourself time. Most of the actions you take will not yield immediate results.

With your team, create a realistic plan and timeline, at least 12 months or ideally 36 months. You will need it to improve the valuation of your business.

Step 3: Prioritization

You guessed it: the execution of this plan is the crucial element to the success of this recovery operation.

To achieve this, engage all functions of the business to review your strategies, corporate and individual. Each initiative and action plan should be reviewed to ensure that they contribute to the success of the business development plan.

You need to make sure you prioritize the priorities! They are not all equal in importance, choose 4 or 5 at the most and make sure to carry them out. The mistake here is to give yourself too long a list and get lost in it…

Step 4: setting up measurement tools

Effective execution requires a relevant dashboard and measurement tools. Determine which key performance indicators (KPIs) will help you track your progress. These key indicators must reflect what is central to the creation of value and, consequently, to the valuation of your company.

You should track these metrics continuously, at least once a month, and adjust your execution based on identified deviations. This is essential to keep your goal in focus.

Step 5: Continuous improvement

Since everything changes all the time, you can only afford to review your planning once a year. You need to keep an eye on your scorecard, because to achieve your goals, you need to maintain a steady pace and quickly correct course when necessary.

Move forward with agility and opt for a quarterly rather than an annual review frequency: this more frequent planning review will allow you to adapt your action more quickly to changing conditions. It will also help you keep up the pace.

The importance of support

When you start a business and then work hard to grow it for years, you don’t always think about its eventual sale. If you don’t take the time to prepare for the sale by maximizing the value of your business, you risk “leaving a good amount on the table.”

A majority of entrepreneurs and business leaders have no experience in this type of transaction. Nothing prepared them to act on a sale.

If you really want to get the most out of your business. You’ll need to plan your exit, ideally over a 24–36-month horizon. Selling your business is probably the most important transaction of your life. Get help, it’s your insurance policy against costly errors and omissions. The support of an expert will help you determine what you need to do to make your business attractive. He will explain to you how to get the true value of what you have built.

This support will also allow you to stay on course during the months. When you and your team are working hard to increase the value of your business.

And if you don’t intend to sell for a long time, keynote speaker support will allow you to step back and improve the efficiency and profitability of your business now.

Leave a Reply

Your email address will not be published.