The day will come when you want to, or have to, leave your business. To make the transition to the next owner as smooth as possible, and to get the maximum return for yourself, you need to start planning now. These are just some of the benefits you will derive from early succession planning:

• The business survives the change in ownership/management and continues on as a profitable entity
• You will identify and address family or shareholder issues before they become disagreements and a threat to the business’ continuity 
• You can minimise tax liabilities and maximise return
• It will ensure an orderly transfer of control and competencies
• The business and future leadership will be ready for the transition   Continue reading

Valuation Rules of Thumb – Fact or Fiction?

Have you ever heard, “That business is worth 2 times gross revenue”; or “one year’s earnings plus inventory”; or “3 times last year’s EBITDA” and so on? Perhaps you’ve had somebody say this to you about your business.

All of the above are rules of thumb. The question is should you be relying on these rules of thumb as a means of deciding the value of your company? Should you be using them to decide on insurance coverage (business interruption and/or life policies to cover the purchase of your shares), asset mix within your investment portfolio, the purchase price of a competitor’s business, or the asking and/or sale price for your own business?

Based on my experience, I would guess that a number of you have at least been tempted to use a rule of thumb to determine one or more of the above. If you have, you are not alone. Let’s face it, in the absence of detailed valuation information you probably didn’t have any other readily available ‘yardstick’ to determine or estimate the value of your business. It’s only natural then to use one of these rules of thumb in the decision making process.

Over time, rules of thumb have become somewhat entrenched in particular industries. Does this make them right?

Just so there’s no confusion here, I’m going to answer that question with a very loud NO, no wiggle room, not sometimes, just “NO!”

Let me demonstrate my point by the use of an example. One rule of thumb that has been tossed around is that a golf course is worth 3 times average gross revenue. Let us assume we have two golf courses that are identical in every way with one exception, they have different bottom lines because one is more cost efficient than the other – lets take a look and see what our 3 times gross revenue rule of thumb would have us believe...   Continue reading

What’s The Impact Of Poor Strategic Planning?

  The following quotations from leading organisations and industry professionals show an alarming lack of strategic planning and strategic development capability. The answer is yes, business owners are in crisis over strategic planning.
• Once strategy is in place, only one in ten companies implements it effectively. (Kaplan and Norton)
• 95% of the typical workforce does not understand its organisation strategy. (Booz)
• In 70% of the cases, the real problem is not bad strategy, it’s bad execution. (Fortune)

So What’s The Impact Of Poor Strategic Planning? In addition to the impact on the financial performance and growth of a business, poor strategic management can have a profound impact on the physical and emotional state of managers and business leaders. Here are the top four symptoms:

1. Persistently feeling tired and stressed.

2. Finding it hard to see a clear direction and future for your business.

3. Feeling like you’re “spinning your wheels” (not getting results, forever dealing with old issues, not keeping up with the marketplace, keeping staff who are under-performing, missing valuable opportunities).

4. Feeling as though you’re out of ideas, stressed and overwhelmed by the effort of trying to take your business where you want or to meet shareholder expectations.

Why Does This Happen?

A few years back I walked into the office of a business owner to find him with his head in his hands in despair. After a punishing decade of daily frustrations and constant stress he had developed chronic health problems and had finally reached his crisis point. Overwhelmed by his failure to make crucial changes and fix long-standing problems in his business, he realised he had no option but to try a new approach and seek understanding of what really made his business tick.

Despite the health impact of daily stress and anxiety, many managers and business owners resist engaging in the strategic planning process and continue to suffer with their businesses for far too long. In my experience, these are the main reasons why:

• Misconceptions about what strategic planning involves.
• Fear of being overwhelmed if they do succeed.
• Too busy putting out spot fires within the business.
• Previous failure in implementing a business plan.
• Cannot separate their business from their personal agenda / life.
• Lost confidence or lack of ideas.
• Lack of expertise or experience.
• Missing and or incomplete critical information about their customers, competitors and market intelligence.  Continue reading

Sales Team Results. 5 Easy Fixes.

Sales Issue 1. Low Sales Lead Conversion

In field or internal sales, a low sales lead conversion would be less than 45%.

To determine what maybe causing this, investigate:

• What it sounds, looks and feels like engaging with your business as the customer (mystery call)?
• Is the team demonstrating a genuine interest in the customer and how do they show this or are they just pitching or worse, following a script?
• How does the marketing process and early stage of the sales process prequalify the leads?
• Are you using your sales time to sell to your true Avatar or just tire kickers?

Sales Solvers
– Shift Sales Mindsets; Define Avatars; Adjust Sales Process; Improve Sales Conversation Skills.

Sales Issue 2. Discounting or Too Many Giveaways

Discounting significantly impacts profitability, and brand and value perception.

To determine what maybe causing this, investigate your value proposition:
• What value do we offer and how important is that to each Avatar?
• How do we illustrate and articulate value in our written and oral communication and through the people representing us in the market.
• How skilled are the team to build dissatisfaction or desire through the sales process?
• Is your culture supporting ‘discount to compete’ or ‘differentiate to compete’?

Sales Solvers –Define Your Avatar; Articulate Value Proposition; Build and Train Questioning Skills; Internal Messaging.

Sales Issue 3. Don’t Know Why We Loose Sales – What the Numbers Say!

Many businesses we work with don’t know what is that is loosing them sales. Here are some CRM ratios and what potential causes these ratios may highlight.

Sales Solvers – Adjust Sales Process; Review Proposal; Train Pressure Free Selling Skills; Define the Buying Stages; Train Buyer Types and How to Sell To Each.

Sales Issue 4. The Endless Follow Up

Many sales people complaining that they are loosing a sales once the get to the follow up stage.

To determine what maybe causing this, investigate:

• If you measure performance by ‘the number of proposals’ or the pipeline total, which has it largest total once a proposal has been delivered. This can drive sales people to rush the sales process just to get to a proposal. Then the never-ending ‘follow up’ process begins.
• If the sales person is offering to present the business a proposal, or it is requested by the customer.
• Is the proposal benefit laden or feature laden?
• The difference to sales if you email a proposal versus presenting a proposal.
• How they are arranging and conducting the follow-up calls?

Sales Solvers – Review KPI’s and messaging; Adjust Sales Process; Train Proposal Presenting Skills and Follow-up Skills; Define the Buying Stages.

Sales Issue 5. Sales Cycle is Too Long Unnecessarily

The sales process and sales people’s behaviours can elongate the sales process

To determine what maybe causing this, investigate:
• What preplanning is done – is there a clear ‘advancement’ objective?
• How much time is dedicated to small talk vs commercial conversations?
• How often do you need to go back and ask more questions?
• When are the other stakeholders joining the sales process from your business and from the customers?
• If sales people understand the buyer signals to determine to move forward?

Sales Solvers – Review Planning Expectations; Train Advancement, Questioning Skill; Define the Buying Stages, Sales process and Expectation of Internal Stakeholders.

Improving sales is more than sales training – a sales team takes five areas to be aligned to really shine – Strategy & Standards; Systems & Processes; Sales Skills; Sales Coaching; Success Rewards

  Continue reading

Preparing Your Business For Sale. Our 5 Top Tips

You’ve poured your energy into growing your business and it’s become a valuable asset. When the time comes to sell you expect your efforts to be rewarded with a fair price to fund your retirement or next venture.Unfortunately, without adequate advice and preparation, many businesses owners end up struggling to find a buyer, or settling for a far lower price than they deserve.

So how do you get full value for your business?

These are our 5 top tips:

1. Prepare a business plan. Identifying a clear business strategy will help you realise the full potential of your business and make it more attractive when you’re ready to sell. Buyers put a premium on growth and profit projections and a clear risk profile and management strategy.
2. Get a valuation. Marketing your business at too high or too low a price can cost you dearly, in both time and money.
3. Engage a broker. An experienced business broker will streamline the process and make sure you get the best possible price. They’ll give you marketing advice, help you find buyers, filter out time-wasters and handle negotiations for you.
4. Think like a buyer. Take an objective look at your business and identify anything that would make you think twice about buying it – then fix it.
5. Be transparent. Communicate clearly and openly with potential buyers and make sure there will be no surprises that could delay or prevent a sale. Keep employees, clients and suppliers (if appropriate) informed about how the sale will impact them. Protect yourself with robust confidentiality agreements so that you can make full disclosure without risk.

When should you sell?

Whether you’re following a succession plan or selling at short notice, try to allow as much time as possible. Rushing the sale or seeking an urgent settlement will drive the price down. Economic conditions and your performance will have a strong impact on market value.

An experienced broker can advise you on the best time put your business on the market.

To receive the White Paper FREE email us direct. In the SUBJECT LINE add 'PLEASE SEND ME THE PREPARING YOUR BUSINESS FOR SALE WHITE PAPER" email:  Continue reading

In The News | Disrupting Mr Disrupter

Clay Christensen should not be given the last word on disruptive innovation.

TWENTY years ago a then obscure academic at Harvard Business School published a career-making article in the Harvard Business Review (HBR), warning established companies that they were in grave danger from being disrupted.

Today Clay Christensen is an established company in his own right. He is regularly named as the world’s most influential management guru (his Harvard colleagues affectionately call him Mr Disrupter). He has applied his theory to an ever-wider range of subjects with books such as “Disrupting Class” (on education) and “The Innovator’s Prescription” (on health). He even has his own consulting operation to help him stretch his brand. Businesspeople everywhere treat him as a guide on how to cope with change. But the risk is that by paying too much attention to his theory, they will miss other disruptive threats.  For the full article visit  Continue reading

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