Recently, I shared an article that listed 10 steps to “Optimize your Business Valuation.” After reading the piece, I began to pull together thoughts and ideas I’ve developed over the past 25 years on business growth and value throughout the life of your business, not just when doing a valuation.
Today, with this blog, I’m starting a
12-part series on how to “Optimize your Business Value.”
Step 1: Change your mindset
The first step may be the most difficult one. But once you make this mental shift, the other steps will fall into place like dominoes.
Look at the two photos below. What do you see?
The house on the left is beautiful, stately, with a manicured lawn. It’s probably in a very nice area, good school district, shopping, and has nice neighbors. It appears safe with less risk. The house on the right looks like it needs foundation work, a new roof, fresh paint, new windows, and some landscaping. It appears sketchy, with more risk.
What if I told you these were the same house? Not a before and after picture, but the same house at the same time. Impossible? Not really. It depends on your mindset, your paradigm, the lens through which you see the object. The picture on the left is viewed by the seller. The picture on the right is viewed by the buyer. Same house. Different mindsets. Different values
When you go to sell your house, you see the best attributes. However, when the buyer looks at it, he is looking at what is wrong with it, what needs to be added, changed, repaired. Same house. Different views. How you view this house affects its value, just like with your business.
For more on changing your mindset, watch this 2-minute video.
Takeaway: Change your mindset from a seller to a buyer.
- Look at your business like a buyer would.
- What would a buyer like? Dislike?
- Make a list of what needs to be corrected, fixed, improved, or replaced.
- Develop a timeline for implementation as well as a cost-benefit analysis.
- Delegate these tasks and responsibilities to your team.
- Hold them accountable.
- Divide and conquer.
If you follow these steps, the value of your business will increase. Please feel free to reach out to me with any feedback you are willing to share, pro or con.
If you have any questions about measuring and growing the value of your business, please contact me for a free conversation.