The value drivers to increase the value of your business prior to a sale
The value drivers – We will work with you to increase the value of your business prior to commencing any business sale if time permits.
Value Driver #1: Stable / Growing and Predictable Cash Flow
Value Driver #2: Reliable Financial Information
Value Driver #3: Margin Advantage
Value Driver #4: Positive EBITDA
Value Driver #5: Customer Diversity
Value Driver #6: Sector Diversity
Value Driver #7: Growth Potential
Value Driver #8: Geographical Diversity
Value Driver #9: Responsiveness
Value Driver #10: Goodwill
PRODUCT / SERVICE
Value Driver #11: Barriers to Competitive Entry
Value Driver #12: Product Diversity
Value Driver #13: Quality Designs and Output
Value Driver #14: Intellectual Property (IP) and Patents
Value Driver #15: Innovation
Value Driver #16: Brand Reputation and Awareness
Value Driver #17: Human Capital / Quality of Workforce and Management
Value Driver #18: Operating Systems and Procedures
Value Driver #19: Facility and Equipment Condition
Value Driver #20: Lack of Legal Disputes
Value Driver #21: Few Uncertainties
Prior to commencing the sale we can review all of the areas above with management and make an assessment as to whether improvements can be made in a given time. To identify the Value Drivers on which to focus, we address two key questions:
- Which factors will have the most significant impact on the future value of the business?
- Which of those factors can be most effectively managed?
Sometimes it is better to delay a sale for 12 to 18 months to maximise sale value.
Remember – Buyers pay for the past, but buy for the future.
If you are considering selling your business within a shorter time frame, focus on the factors that will yield the greatest impact over that shorter term.