The fastest growing business segment in the U.S. today is the small to mid-sized privately owned company. Entrepreneurial owners are betting the farm – guaranteeing debt, working fourteen-hour days, and generally running flat out all the time. For all their hard effort, all too many end up “owning” little more than a job. Worse yet – the job you own is one without lots of security or benefits. It is also a job attached to a lot of worry and responsibility.
The object of business ownership is to own VALUE. It is to build, own, and to someday sell a company so you don’t have to worry about money. It is to win the freedom to call your own shots, and – yes – even to take off work time occasionally.
Until you build a living, breathing entity that can thrive without you, face it: you don’t own a company; you own a JOB. You can, however, change all of that.
What are the 3 key elements to that process?
1. Nurture People Who Can Assume Decision Making Roles:
Often the hard-charging founder of a small business has trouble “letting go” – or handing the reigns over to other managers. Until that happens, the enterprise is vulnerable due to one-person dependency, and value is diminished. Sure, they will sometimes make mistakes. But…guess what? You do too, once in a while.
2. Build Customer Loyalty At Multiple Contact Points:
Customer relationships often begin with an owner-entrepreneur who over time, gradually hands off the least critical of such relationships to other sales executives. Imagine how much stronger that relationship becomes if it’s rooted at many levels within the organization. For true security, add depth and breadth to the service network and do what you can to ensure that customers love many contact points within your organization.
3. Document Key Technologies and Work Patterns:
Most small to mid-sized entrepreneurs have relatively scant documentation on their systems and policies. This creates vulnerability as people transition, and costs time in constant small needs to recreate mechanical solutions and systems. Grow up! Write it down! There should be no element of your organization which new resources would have to “start over” in the event of lost staff.
What is your reward for all of this? It’s value enhancement. When the time comes to sell your company, buyers want assurance that the company can continue without you. Even if you are willing to continue working, buyers will not be willing to count on that. You will never win the gold prize if the future value of your business fails without you.
Our firm is in the business of selling companies with headquarters in Oklahoma. We often wish we could meet every client a few years before they want to sell, so that we could take that independent look as buyers do, at strengths and weaknesses for possible sale. You can start now.
By the time you have accomplished only the few things listed above, you will have built your company’s value immeasurably. Own a company – not a job! Your personal flexibility and professional value will be greatly enhanced!
