If you own a small business you’ve likely put in years of work and money into your business. Your business is YOUR legacy. Today more than ever your legacy is being threatened by a living organism that cannot be seen by the naked eye. One that has created fear and anxiety among your customer base and has ripped small businesses down by the thousands. Sure, you’ve survived recessions- but have you ever survived a pandemic that turned political and psychological?
The problem with today’s business climate is that NO ONE saw it coming. We’re all urged to plan for the worst and have contingencies, cash reserves, and branding that will last. If you were like many who didn’t plan for the plague, you might be thinking about selling your business right now. If you’ve survived and/or are surviving, let’s discuss some ways to avoid where many are today: Sell or Close. There ARE ways to make an impact on the value of your business rather than make an emotional decision to call an auctioneer or traditional business broker (aka, the “garage sale”).
Let’s discuss a few of those ways- specifically these are things we do for clients to increase value in the business. These simple (and cheap) tips will help add value to your business if today you said “I need to sell NOW”. We’ve even SAVED businesses by doing these things.
- Dump useless inventory. If you hold inventory and it has surpassed its natural life or you bought it anticipating a sale- get rid of it. There should be no “sacred cows” on your shelves- it holds no value in a sale.
- Clean house. We literally mean- clean. Clean restrooms tell your customers that you are serious about health and safety. Skimping on cleanliness will drive down the value of your business. Take out the trash, present your products in an organized fashion on your shelves, cut the grass, weed your flower beds, and sweep the floor. Curb appeal applies to business, too!
- Optimize Space. Have you ever walked through a particular big box retailer and said “geez, if you are going to have 30 registers but they’re all closed, why are they there???” So have we. If you’re going to have a bunch of check out lanes, but never anyone there to man them- how could you use that space more profitably?
- Pick a successor. There are SO many ways to do this- and it costs you nothing. If you have dedicated and loyal employees and customers, they’ll thank you for stepping out responsibly. People have dedicated their lives and careers to YOUR business- it will mean something to them to imagine a successor who will carry forward (and maybe improve) what you’ve built instead of selling to someone who will turn your property into the shiniest new apartment building.
- Know your worth. You’ll be happier if you look in the mirror today and say “I’m worth more than a fire sale of my assets, and so are my customers and employees”. Capitalism rocks, we agree- so use it to your advantage. Don’t let someone come into your business and stick a number on it to the market. If it takes an extra year to add some extra value, why not do it? Explain to the leaders in your business what you’re trying to do. Gordon Gekko can’t touch you if you don’t let him.
- Creatively find capital. Hire a utility auditor, sell your building (but keep the business), sell off useless inventory and equipment, or consolidate debt. These are ALL ways you can keep your business going without losing everything.
If after reading this you STILL want to call an auctioneer or traditional broker- call us. We can at least provide a referral or provide some very creative ways to get the most out of your business at the time of sale.
Rob Simon | Principal
Phone: (440) 590-5298