Want to make your business more valuable? A business owner should always have the long term in mind when operating a business. This means doing things to make the business more valuable upon transfer, whether it be by sale to an arms length third party buyer, or in some other fashion.
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Here are some basic things to consider in regards to Increase the Value Of a Business
• Minimize Customer Concentration: Reduces risk that significant revenue can disappear with a lost customer
• Repeat Customers: Always very attractive to buyers, and lenders, makes it easier to get financing.
• Drip marketing Campaign in Place: This makes it simple for a buyer to have a smooth transition, with the added bonus of helping maintain or grow your business
Employee Manuals & Procedures:
• Have the Employee Manual Detailed & Up to Date to help make the business run smoother
• The LESS the owner does, the BETTER: Delegate tasks and have clearly defined roles for the staff
• One Man Show: A business is more valuable when the owner(s) can step away for a while and the business can continue running without interruption.
• Have a long enough lease: A lease that is too short is a turn off to buyers.
• Negotiate a Market Rate (or lower) lease rate: Each dollar in savings on the lease is an extra dollar of Profit! Lease Negotiation Services.
• Take Advantage of the current market conditions, which have lease rates far below the rates of 2007. Assignment Clause:
• Pay attention to the Assignment & Personal Guaranty Clause: Both of these can be sticking points when you want to sell, so read up on them in your lease to understand the challenges facing you.
• Clear up Maintenance Responsibilities between you and the landlord
Books & Records:
• Minimize unnecessary Discretionary Expenses: These are write offs that aren’t easy to document. They will drag down the value of the business.
• Cell Phones/Domestic Nannies etc. On Company Expenses are common examples.
• Upward Trend in Revenue & Especially Profit in the most recent Three Years is most important in Qualifying for Bank Financing
Inventory and FF&E (Furniture Fixtures & Equipment):
• Clear Out ‘Dead’ Inventory which is Slow Moving or Obsolete Inventory
• Liquidating/recycling unneeded equipment/inventory has Benefits:
o Cleared Up Space & Generates Cash $$$
• Tidy up The Back Office, Storage Room, Stock Room Etc.
• Tidy up Office Space
For More information on how Just Elementary, Inc, Business Brokers can help you with Negotiating Your Retail Commercial Lease for your business contact our Client Care Manager Sonia Chhabra at (888) 926-9193 or email email@example.com