If you don’t want to plan your exit from your business then don’t. It’s that simple. However, that doesn’t mean you shouldn’t work on your business. Work on your business to make it more productive, more efficient or as I like to say, help make it recession proof. Being prepared is part of being successful at business.
With Baby Boomers owning most US Businesses it is understandable that the focus of many business consultants is to focus on helping them transition their businesses to others. Why wouldn’t they, with roughly 10 trillion dollars of business involved it only makes sense. But Baby Boomers don’t own everything, and not all Baby Boomers are thinking of retirement. We are living longer than our parents and Grandparents so staying in the business longer also makes sense. The youngest Baby Boomers are about 53. They could have another 20 or 30 years of working life left if they choose. Their businesses need to do things too.
If you don’t want to plan your exit, what should you do?
Continue To Market – NEVER stop marketing your business. Marketing should be a fixed budget item and not something that you do or don’t do when you can’t afford it. To ensure that your marketing is targeted, prepare a strategic marketing plan for your business for, track your rate of return from your marketing efforts and adjust as the facts show you.
Develop Sales Goals – It is sometimes surprising how many businesses do not have sales goals. Without goals, your sales are neither predictable nor sustainable, and you cannot forecast your growth. Sales goals and corresponding sales management tools help you ensure that your sales efforts are successful. You must ensure that your sales efforts are ongoing, even if you are at your capacity. You can always create a pipeline for future sales.
Understand Where Your Money Goes – This is not an “ask your accountant or bookkeeper” matter although they will have a role. Your Accountant or Bookkeeper prepares various reports for your business. These reports tell you what has happened financially in your business. They do not tell you why or help you address specific causes for why. By understanding your processes, how they contribute to your financial success, is an important part of successfully recession-proofing your business.
Stay On Top Of Your Accounts Receivables – Obviously, the money coming into your business ensures that you can pay your bills, helps you and your employees meet all of your needs, provides for the “extra’s” in life and so on. You should ensure your customers pay you on time and in full always. Review your payment terms, if they are longer than 30-days consider shortening them to 30-days or less. Work with your Business Advisor or Attorney to amend your late payment (anything over 30-days) processes. If you can, consider a Credit Card Merchant Account to help speed up payments.
Build Good Customer Relations – Helping your customers be successful is a great strategy for excellent customer relations. That means being a resource to them and not simply a supplier of product or services that they pay for. Keep in touch with them on a regular basis but not so often that you are seen as an interruption, and don’t make those contacts all about them buying more from you. Seek their input on how YOU can help THEM be more successful.
Diversify Your Customers – It is important that where possible, you diversify your customers. Generally, this is done by establishing customer relationships with different industries instead of different individuals.
Add Value, Not Price – Your product and services should be offered at a fair price, but more importantly, what you offer should have value. Reviewing your pricing strategy along with the feedback you get from your customer relations will help you balance price and value appropriately. Ideally, you only want to increase price when value is increased. Consider a “Good, Better, Best” pricing strategy that offers more value for an appropriate price.
Know your business processes – Understanding your business processes and implementing a “Constant Improvement” approach can help you profitably deliver your product and or services al;l the time. Making changes to those processes where the change provides more value than cost helps ensure that you are as efficient and productive as you possibly can be.
If you don’t know how to do these or aren’t sure you are doing the right thing – that’s OK. That is what people like me are for.
The sooner you start working on these items the better your financial return from your business. Further, and here’s a little secret you probably already figured out. All of this improves your business value so that when you do decide to prepare for exiting your business, you are well on the way to doing it right.