Time to Sell Your Business?

Business owners will be confronted with the decision whether to sell their businesses. True, it is a very emotional decision to make.  You conceptualized the business from the very start, built it, endured trials and tribulations,and now the thought is blooming whether to hang it all up.

Just as there are many businesses, there are as many reasons to have thoughts of selling. Here are some of them:

  1. Financing may not be available for capital investments, or too expensive to undertake.
  2. The industry is turning down and you want to sell while strategic buyers are still willing to buy.
  3. Conversely, the industry may have seen some events which have driven sales prices high and you want to take advantage of this “window of opportunity”.
  4. You want to retire and reap rewards of your hard work, and  you didn’t plan for  a successor.

If you decide to sell, you should think about how to get your business spruced up for sale. You need think along the lines of asset values,  product lines, customer list, sales force, distribution channels, and employees.

One of the first things to consider is the items on your balance sheet. What is the investment you made in equipment.  What is the state of your equipment; is it technologically advanced or is to ready for the junk heap? How much is it worth?  What is the value of your intellectual property? Do you own any patents and/or trademarks?  Would you be selling them or keeping them for their royalties?

A potential problem area is that of inventory.  What is its value: is it overvalued or undervalued?  Is there any obsolete inventory or failure to properly count inventory? What is the return rate on your inventory,and why was it returned?

Are the liabilities recorded properly, are there any missing?  Are the accounts up to date?

Are the receivables collected on time and recorded properly?  Are there sufficient reserves for doubtful accounts, sales returns and allowances?

The Customer List is a valuable asset.  Many companies would love to obtain a good customer list to increase their own businesses.  What is the concentration of your customers?  Do you have a few large customers with frequent orders?  Where are they located? What is your distribution channel like, distributors, dealers or direct to consumers?

What are your key competitors’ market share?  Are they growing, or declining?  What is the impact of foreign competition?

With regard to your products, who are your suppliers?  Do you manufacture yourself or outsource all or some of your production?  Does your production process require skilled labor?  What are the production costs?  Are you sales increasing or decreasing?  Can you supply three years of projections, including trends and seasonal or cyclical fluctuations?

Any potential buyer will want to look at your financials.  Three years of up to date historical numbers is the norm.  Depending upon the sale date, you may have to obtain interim financial statements.   All of the financials will have to be audited.

So you see, the decision to sell should not be taken lightly.  There is a lot to do to get your business in shape and attractive to a potential buyer.  So, take this advice.  Keep your records and agreements in order, and keep your books up to date.  Run a business in good order, and your business will be attractive to any suitor.







A New Way to Market

Have you ever gone into a store whether it is an electronics store, supermarket, or fashion department store and found on product labels this curious square with the words “scan me” for additional information?  That little square whether it is in black and white or in color is a QR Code (quick response).  You can upload this information into your mobile phone by scanning it for contact information or for product information.

QR Code

What do you do with this QR Code?  You can add it to your business card, put it on tag labels on garments and on packages all with the aim of driving traffic to a sales campaign or website to providing consumers with more information on a product or service.

But before you go ahead and have one designed for you, and you start adding it  to everything that represents you and your business, you should have a strategy in mind. Scanbuy, which processes 20% of all the QR Codes scanned globally, saw an increase in average scans per person from four scans in 2014 to 4.6 scans in 2015.  The industries which consumers are scanning QR Codes are food and beverage, consumer electronics, media, entertainment, wireless and home improvement.

But there is something for us to remember, not all consumers will be using these codes.  We have to determine that our target market will or has used QR Codes, and determine what motivates them.  How can these codes help me to grow my marketing strategy?  Will they pique curiosity enough to initiate the act of purchasing?  These codes can actually link to another page or document, so think what you want them to link to, a resume, a newspaper article or customer recommendations.

The target audience that uses these codes the most are the Millennium generation, those people who are 18 to 35 who use social networking.  But that doesn’t mean that this is the only target, older, savvy folks may use it as well, but they are slower to adopt them.

These codes are another way to have potential customers recognize your name.  So, give it a try and see what happens.