Sunday, August 25, 2019

Business Management

Are you stuck in a pressure cooker?

In need of tips to reduce the stress you are under? 

You may want to consider some of the following options in order to lessen the impact or negative effects on your business operations:
- Know your body signals: excessive heart rates, headaches, anxiety may be signals and suggest a need to find time to wind down.

- Don’t procrastinate and postpone decision making. Difficult decisions are not made easier because you postpone them. At times conditions may worsen if issues are not resolved.

- Take 10: Without really ducking a decision, stress can be relieved if you just take a short break or switch tasks for change of perspective.

- Stay fit. A program of regular exercise can help your body and mind deal with difficult situations that may arise from time to time. Try to maintain a healthy diet to support your overall health.

- Achieve balance between work and other family and personal activities. Enjoy time away from the job to let you recharge your batteries. Plan periodic vacations or days off. The organization is unlikely to collapse because the boss is away for a short time.

- Delegate:  No one has a monopoly on all of the good ideas and ways to resolve problems. Let staff participate as part of team that enjoys successes and faces difficulties on the job as well.

- Network: within and outside of the business to share ideas and issues with. Trust people to help with business issues. Working in isolation is rarely a good idea.

- Manage fairly: It’s nice to want and demand high standards but an obsession with perfection can destroy a business and the people that surround you.

- Monitor: Make sure key support people including those managing the finances keep you up to date. Since cash flow is a key marker make sure expenses are kept under control and systems to improve productivity are reviewed often. A well run business with good information flow is a key to stress reduction. Eliminate surprises.

These suggestions won’t eliminate all of the stress in your business but I find they help keep stress at a manageable level. Please let me have your comments.

Sunday, August 11, 2019

Increase the Value of your business

Most businesses with under $1 million in revenue (which is most businesses) sell at a very small multiple of earnings when their owners decide it's time. Typically they get two or three times their pre-tax profit, if they're lucky. How can you get more juice out the company you've spent years developing?

Here are a few ideas that may help grow that important valuation.

1. Recurring revenue: 
Demonstrate that your customers come back to purchase regularly and you'll drive up the value of your business because buyers will have confidence your sales will continue long into the future.

2. Revenue growth rate: 
Acquirers will look at your top line revenue growth and project how large your business will grow in the future. Revenue growth rate may be even more important than profit growth for driving value. Buyers know how to squeeze margin to increase profitability but it is difficult to replicate the formula you have that makes someone want to buy your product.

3. Positive cash flow: 
If your company takes in money before it has to spend it, buyers will pay more for your business. Acquirers look at opportunities by measuring the return they'll get on the money they need to invest. If your company generates cash, they will not have to put much of their own into funding your day-to-day operations. The less cash they inject, the better the potential return on their investment.

4. Succession: 
You may want to consider firming up plans for a successor to your leadership position. Having a second-in-command will help you show the business can continue on successfully without you. If you can't afford an entire management team, at least find and groom your right hand person.

5. Differentiate:
You'll get a higher multiple for your business if your product or service is truly unique in the market. Acquirers will graft your product onto their distribution channels and estimate just how big your company could be in their hands. That only works if you have a truly different product or service.

I hope these few tips provide some insight into steps you may take to present a positive opportunity as you reach a stage where you may want to move on to newer challenges. Please let me know your