Are You Driving Down Your Business Value?
If your business is reliant on you for the day-to-day operations, prepare to get less money when you go to sell it.
Do a quick self-check; how often do you say phrases like:
- I just can’t get away
- My employees can’t make a decision without me
- My customers only want to talk to me
- I feel like I’m always catching up
- There’s too much to do
If you are a Hub & Spoke owner – one who is at the hub of all activity – you are responsible for driving down the value of your business. Consider this: Buyers don’t want to purchase a job. If a buyer has to hire your replacement, it will reduce their profits, thereby reducing the value of your business.
Ask yourself this question:
How would my business perform if I were unexpectedly unable to work for three months?
Which would be your answer?
1. Hardly suffer at all
2. Suffer a little, but survive
3. Suffer a lot, but survive
4. Suffer a lot, and not survive
If you answered number one, hardly suffer at all, then a seller is much more likely to pay a premium for your business. The less dependent your business is on you, the more value it has to a buyer.
Hub and Spoke is one of the 8 Drivers of Business Value. You can find out how your business scores in all eight drivers of value by taking a quick, confidential 15 minute assessment. Take the time today to get your Value Builder Score and identify what you can do to start increasing the value of your business.