Building a Business to Last and to Sell
How to Grow Your Company’s Potential
Street Smarts columnist and veteran entrepreneur Norm Brodsky has shared his advice on building a business, and it may not be what you’d expect. Brodsky recommends running your business as if you are going to own it forever, but also as if you are going to sell it tomorrow.
While this may sound like opposite approaches, he explains that the two are much similar than they sound. Importantly, building for the long term positions your business to sell today for the highest price possible.
Building a business that you both intend to keep forever and could successfully sell tomorrow means that you:
Don’t take shortcuts when building a business
If you are creating something to last forever, build it on a solid foundation. Shortcuts often deliver quick but temporary results. Similarly, a well-built foundation helps ensure a profitable business and the likelihood of a successful sale down the road.
Brodsky cites some specific examples of shortcuts that backfired on him, but the lesson here is a broad one that you’ve likely heard before. If something is too good to be true, it probably is. Shortcuts exist because they’re easy to take, but rarely are they worth the headache they’ll give you down the road.
Maintain certified financials
A good financial record is imperative for owners to fully understand their business. Business buyers, however, may not always trust a business owner’s accounting records. Having financials certified by a third-party accountant can give buyers extra confidence in your business. In turn, that might help you achieve the maximum price in the event you look to sell.
In addition to being one of the three things buyers look for, Brodsky highlights another, more immediate benefit of having rock-solid financial records: getting a loan. Should you suddenly find yourself in need of financing, you’ll want a strong track record you can point to.
To learn more, read the full article on Inc.com.
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