The Most Important Goal of the Smartest Business Owners
What are your business goals for the year? If you’re like most owners, you have a profit goal you want to hit. You may also have a top line revenue number that’s important to you. While those goals are important, there is another objective that may have an even bigger payoff: building a sellable business!
But what if you don’t want to sell? That’s irrelevant. Here are five reasons why building a sellable business should be your most important goal, regardless of when you plan to pull the rip cord:
- Sellability Means Freedom: One of the fundamental tenants of sellability is how well your company would perform if you were unable to work for a while. As long as your business is dependent on you personally, there’s not much to sell. Making your company less dependent on you by building a management team and creating “just-add-water” systems for employees to follow means you have the ability to spend time away from your business. Think of the world of possibilities that would open up if you could choose not to go into the office tomorrow….
- Sellable Businesses are More Fun: Running a business would be fun if you were able to spend your days on strategic thinking and big picture ideas. Instead, most business owners spend the majority of their days on the minutia: government forms, employee performance reviews, bank reconciliations, customer issues, reviewing expenses, etc. The boring details of company ownership decrease the enjoyment out of owning a business—and it’s exactly these tasks you need to get into someone else’s job description if you’re ever going to sell.
- Sellability is Financial Freedom: Each month you open your brokerage statement to see how your portfolio is doing. Not because you want to sell your portfolio right now, but because you want to know where you stand on the journey to financial freedom! Creating a sellable business also allows you peace of mind, knowing that you’re building something that—just like your stock portfolio—has value you could choose to make liquid one day.
- Sellability is a Gift: Imagine that your first-born son graduates from college and, as a gift, you give him your prized 1967 Shelby Ford Mustang. Your heavily indebted child takes it on the road, but after a few miles, the engine starts smoking. The mechanic takes one look under the hood and declares that the engine needs a rebuild. You thought you were giving your child an incredible asset, but instead it’s an expensive liability he can’t afford to keep, and he can’t sell it without feeling guilty. You may be planning to pass your business on to your kids or let your young managers buy into your company over time. These are both admirable exit options, but if your business is too dependent on you, and it hasn’t been tuned up to run without you, you may be passing along a jalopy.
- Nine Women Can’t Make a Baby in One Month: There are some things in life that just take time, no matter how much you want to rush them. Making your business sellable often requires significant changes; and a prospective buyer will want to see how your business has performed for a few years afteryou’ve made those changes.
Are you curious about how sellable your company is and what you would need to tweak to sell it when you’re ready? Then it’s time to get your Sellability Score via the questionnaire on our website. It takes about thirteen minutes, and your responses are kept confidential. You can complete the questionnaire here: Sellability Score.
The Summit Acquisitions Group — Business Brokers and M&A Advisors — specializes in the sale, appraisal, and financing of privately owned companies ranging in valuation from $750,000 to $25,000,000. Contact their offices in Atlanta, GA or Charlotte, NC for a free consultation.
