What does it take to maximise the sale price of your business?
As a baby boomer business owner in Australia you’ve pretty much seen it all. From the Economic ups and downs to the changing customer needs and the technological advancements.
Now, as you look towards the next sequel of your business and the potential of selling your business in the next few years I’m sure you’re thinking about how to position your business so it stands out in a crowded market.
The old tried and tested strategies are starting to become less relevant.
One approach might surprise you – it’s the concept of stewardship.
What is Stewardship?
Stewardship is about running your business with a bigger purpose in mind. It’s not just about making money, but about making a positive impact on your employees, customers, and community. It’s a way of positioning your business so it’s appealing to potential buyers and is more valuable.
Here are a few practical steps to start the stewardship conversation inside your business:
1. Find Your Purpose
Think about why your business exists beyond just making money.
Maybe you provide a service that really helps people, or perhaps your products make life easier for your customers. Whatever it is, make sure everyone in your business knows and understands this purpose. When your team is working towards a shared goal, it can make your business run more smoothly and be more appealing to buyers who want more than just profits.
2. Listen To Everyone
In the past, business decisions were often made by a small group of people at the top.
But times have changed.
Today, it’s important to listen to everyone – your employees, customers, and even your suppliers. They might have great ideas that you haven’t thought of.
Set up regular meetings or encourage ways to gather ideas. When everyone feels heard, they’re more likely to be happy and productive, which is great for your business.
3. Think Longer-Term
Three years is not a long time. It’s easy to get caught up in day-to-day problems and forget about portioning off some of your time to thinking about the long-term future of your business. This might mean investing in new technology or training your staff in new skills.
It could also mean looking at how your business affects the environment and finding ways to be more eco-friendly. Buyers are often interested in businesses that are ready for the future, not stuck in the past.
The long-term planning is not for you. It’s for the potential buyer to see that there is a positive future for the business and it’s worth investing.
4. Be Open and Honest
In today’s world, people value honesty and openness. I call it Transparency.
This applies to your employees, customers, and potential buyers. Be clear about how your business is doing and what your plans are.
If there are problems, don’t hide them – instead, show how you’re working to fix them. This kind of honesty can build trust and make your business more valuable.
I like to think of this as the pre-due-diligence test. The idea is when the actual due diligence starts, you have the business at a point where there big ticket items are sorted, and the less important issues are being dealt with.
5 embrace Diversity
Diversity can imply many things. Ethnic, Age, Gender, Profession. These are the obvious ones. And then there are the diversity of beliefs. You might also call these opinions.
The one thing that 10 years in Papua New Guinea taught me as that allowing a diverse set of thoughts and background surprisingly came up with creative solutions.
Having people from different backgrounds can bring new ideas and ways of thinking to your business.
Plus, a diverse workforce can make your business more appealing to a wider range of customers and potential buyers.
Why Does It Matter?
You might be wondering why all this is important, especially if you are planning to sell your business soon.
The truth is, today’s buyers will be from the people younger than you. They are looking for more than just a profitable business. They want a business with a good reputation, happy employees, and a positive impact on the community.
By focusing on stewardship, you’re not just making your business better for now – you’re making it more attractive to potential buyers. You’re showing that your business is ready for the future, whatever it might bring.
Remember, to be in a position to get the highest price you need to be offering value.
It is no different to selling a product.
The right buyer will find you when your business is positioned correctly.
So, as you look ahead to the next few years, think about how you can apply these ideas to your business. It might take some time and effort, but the rewards – both for you and for your business – can be well worth it.