It’s that time again—when we all swear we’re going to hit the gym, cut down on the junk food, and maybe, just maybe, get a grip on our business finances.
If this sounds like you, I’d like you to join me today on the journey of understanding the true value of your business … and how it can take as little as 15 minutes a day.
There are many things that affect the value of your business.
And, yes, that sexy revenue number grabs all the headlines, but the true value of a business is actually made up of many more threads than just that (cash flow, customer concentration, and process efficiencies, to name a few).
Completely new things start to matter; things like valuation multiples, freedom from the business owner’s name, and dependable financial reporting – these characteristics start to have a huge impact on how a potential buyer of your business will pay for it.
And hey, I’m not implying that you are even anywhere near ready to sell your business.
But even if you’re not; knowing what your business is worth is like having a golden ticket in your back pocket anytime you may want to pull it out. Something for when life throws you a curveball, or another opportunity to pursue … or, maybe even, someday, retirement.
Remember: your business is your investment.
You have put time, money, blood, sweat, and tears into it for a significant period of time.
So knowing its true value is about understanding and leveraging its wealth-building potential; your wealth-building potential.
Watch for our next couple of blog posts to see how you can make a couple of important tweaks to how you think about your business to raise this wealth-building potential as much as possible.