Are You the Problem?
We’ve spoken before about what adds to company value, having good systems, keeping clean books and happy employees are at the top of the list. But what detracts value?
What you may not realize is, you personally may be holding your company back, even if you’re as dedicated, focused, and hard-working as you’ve ever been. Still, you could be the problem.
It has to do with your skill set and what you do day-to-day for your business. I’m not talking about CEO-like duties. Making decisions on hiring, accounting, and inventory are the topline responsibilities of the President/Owner in most small businesses.
I’m referring to your technical skill set. Are you involved in technical work so critical, the business would cease to function if you were not involved? It might be if you are the only one in your organization with a critical professional license that would cause you to be non-compliant with the law if you didn’t have one.
It might be you operating a specific piece of equipment or software nobody else knows how to run. We call this a single point of failure and it’s a problem that impedes you from building further company value. After all, you want to cash in your sweat equity and sell your business one day right?
If this describes you, your business value is seriously diminished and is potentially unsellable. Here’s how you fix this looming problem.
Define your job
Take the time to sit down at the computer and write out your job description. Give yourself a title (Not CEO, owner, or president). Carve out the technical duties you perform and go into great detail. This exercise is the beginning of defining the role you need to hire for or train someone else on your team to do.
Identify a #2
Every business needs a next-in-charge. Perhaps you already have this person identified. They are the one that runs the operation when you take a vacation and you trust making management-level decisions. If you don’t have this person on your team, you won’t be able to take a step forward in building your company value. Put yourself in the buyer’s shoes. When you are out of the picture, wouldn’t they want someone that knows how you do business and is capable day one? Of course!
Unfortunately, I do speak with business owners all the time that are approaching retirement or some other health event forces them to list the company for sale. I have to be the bearer of bad news when I tell them that they are the reason the company cannot be bank financed or there are no willing buyers.
Don’t let that happen to you. Your highest and best use is as the company leader, not the technician.
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About Bianca Evans
Bianca Evans is an experienced business broker based in Jacksonville, Florida. She is a top producer in her field. She has made over 170 transactions since 2006 which makes her among the most seasoned in the area. She is a Certified Business Intermediary (CBI), a Certified M&A Professional (CM & AP), a Board Certified Intermediary (BCI), and has her B.S. degree from the University of Florida.