ph: 0408402890
michael
To Grow
It is easy to simply push change through a business and then play the blame game when it all goes pear shaped however, more difficult to effectively plan and implement change that is readily adopted at all levels of the organisation. Sometimes this is achieved within the existing culture and other times requires a change of culture. In all cases it requires careful analysis and a well considered game plan.
A wise initial decision, is to engage independent assistance to reach logical and objective decisions. Large (especially listed entities) have a Board of Directors that includes 1 or more described as “Independent non-executive Directors". These Directors do not hold shares in the business nor do they become involved in the day to day operational decision making. Broadly they act as a watchdog in all strategic decision making – ie to assist the Board make objective decisions rather than subjective or emotionally biased decisions. In a smaller company without a formal Board of Directors an independent consultant or advisor, able to grasp the vision of the business owner, plays an equally important role in seeking objective decision outcomes.
If the plan is to acquire an opposition or synergistic business then it is equally wise to make an approach through an anonymous 3rd party so that your identity is not disclosed at an early stage. Logic is that if you approach another business directly with an offer to buy then you give up most of your bargaining position – you have nowhere to go, nowhere to hide in the discussions and it risks becoming an emotional discussion that may not end well for either party.
TO GO
To decide to sell a business is, for most founding owners (often baby boomers), a very significant decision, one often put off for too long and lacking in strategic planning.
Working to generate sufficient revenue and profit each year in order to take a salary and dividend is about your job and how much it pays you.
Taking decisions and implementing them with the intent to grow the business thus increase the value or, worth of the business, is about your investment (the business).
Too often the owner (MD) of self-owned businesses pays far greater attention to the day to day revenue / profit than the overall value of the business and unfortunately this does not change as they get closer to wanting to sell.
Reality is that all businesses should be operated as if they were being readied for sale. A simple SWOT of the business should assist the owner make prudent decisions that will, if not hopefully improve, at least defend the existing worth of the business. Primarily, how relevant is the business to its existing client base both now and into the future. Is productivity being optimised ? Will a buyer look at the business as an opportunity to buy some more clients for a low cost or, will they be able to look at it as an opportunity to more rapidly grow / improve their business. Obviously the second option is more likely to yield a better outcome than the former.
Grow or Go – just don’t stand still !!
Whether the objective is to Grow or Go the first steps are pretty much the same and I am sure you have heard it all before - Prepare, Prepare, Prepare ! Boring but true however, your job priority remains, to manage your business. So stage 1 is basically undertaking a brief strategic review of the business including a basic SWOT followed by a well considered plan of action.
Phn Michael O'Connell 0408402890 - Business Consultant & Aust. Lic Business Broker.
Warranty: Content and Information on this site is not intended as advice and should not be relied on by any other party in the making of business decisions. Information contained on this site shall not be copied or, posted to other sites without the express written consent of the management of A.S.Fisher Co. All rights reserved. Copyright .
ph: 0408402890
michael