Whether you’re trying to sell your business or attract new investors, everyone would love for their business to grow in valuation. The question is how. There are some simple things that you can do, like lowering your debt burden, but there are tons of other methods that you can use as well. Some of them might be much simpler than you imagined too. Let’s take a look at some of the steps you can take to increase your business’s value, starting today.
Get a Real Valuation
You have to make sure that you have the right valuation in the first place. While you may be able to get a ballpark idea of how much your business is worth based on income and other easily identifiable metrics, only a true professional will be able to get you a correct valuation.
For this, we suggest you check out a service like wabusinessvaluations.com.au. They provide fast, accurate, and confidential business valuations for businesses in all sorts of sectors. This will give you a clear idea of what is affecting your valuation and if there’s something that can be done about it. They might also be able to look at things that you may have missed like accounts you have with suppliers, the longevity of your current workforce, or customer loyalty among other things.
Now is the time to get creative and try to find ways to diversify your income and assets. Maybe you could eye a second location if you think it would be profitable, or you could start expanding your service/product offering. Maybe even think about selling derived products.
You can’t base any decisions on a hunch, however. It’s a better idea to consult with your clients and see what they would like to see and be ready to pay for.
You should also try to find ways to increase your margins. Depending on your efforts until now, there might be plenty of ways that you could do so. The best way is to find a way to streamline your operation and make it more efficient. Reducing overheads can also be done in several ways.
What you want is to reduce waste as much as possible. So, you could run a leaner operation and have systems in place to monitor performance. It would also be a good idea to run an energy and business process audit on your organisation and see where you might be able to trim the fat. You could try to consider forming a strategic partnership with one of your competitors so you can increase your buying power. Be creative, and make sure that you plan for future purchases as well.
Buyers will also be impressed if your processes are up to date. Having a solid project management system could make a world of difference, for instance, and it would only require a small investment on your part. These are the kinds of details that could help your business stand apart while simultaneously increasing your bottom line.
Make Sure Your Executive Team is Stacked
Management will also be a major concern for savvy investors. They will want to know who will be running the show and if they can be trusted. If they’re unproven or you’re missing key elements, the buyer may have to work on recruitment, which may warrant a discount.
Another thing that buyers will be leery of is if the whole business rests upon your shoulders. You want someone there who understands the business as much as you. This will make sure that there’s someone to pass the reins to that already understands your business processes in and out.
Promote Your Strengths
Another thing you want to do is find a way to differentiate yourself in the marketplace. You want to show what makes your business stand apart. If it doesn’t, then you will have to find a way to do so.
One simple thing you could do is take a look at your competition. Look at what they’re doing better and worse than you. Improve on areas where you’re lacking and overdeliver on the areas where you excel. Also, make sure that you look at both your reviews and theirs. See what people love about them and see how you can replicate or exceed that.
This is another area where your processes could help. You might not have a significantly different product offering than your competition, but if you can show how much more efficient you are, this will be a plus for you. Maybe you’re better at managing your fleet or you have better deals with your suppliers. These are all things that will increase the value of your business.
These are all factors that could affect your business’s value in the eyes of buyers. Make sure that you apply as much of these as you can if you want to get the best deal possible.