To all of you true blue red-blooded Americans out there and more importantly happy Fourth of July to those men and women sacrificing their time to defend our great nation overseas for all you and your family thank you for your service and thank you for your sacrifices have a happy and safe 4th of July.
Today we are discussing Financial Performance. But first, let’s talk about valuations. If you have a business and you want to sell it you will go through a valuation process. A typical valuation process for financial types is the dreaded discounted cash flow...it is not your friend. An accountant will look at your history and discount you value for each year you have been in business. It looks like this.
Now your forecasting 10 years at $1M per year, yet you are only worth $5M to potential buyers. Our process helps you change that number and get the money you deserve for your great company.
Today we are going to focus on 3 areas to improve your financial performance:
You must do #3...end of discussion.
You can increase your revenue a number of ways, but the easiest way is to sell more of your stuff to different people. Same stuff in a different market. Too many businesses get focused on building and selling different stuff, but this kills your profit margin because you become too specialized and every product is different.
Let me explain. If you want to increase your profit margin, you find ways to simplify and reduce costs. Your process needs to be teachable and easily repeatable for your employees. Your product must be valuable to your customers. If you offer too many specialized products your manufacturing costs go up exponentially.
You can also increase revenue by packing products and services which make them more valuable to your consumers. Find ways to differentiate your offering. By differentiating yourself you create a monopoly for your business, make your company more competitive and more valuable to future buyers.
Improve your financial performance by GETTING A BOOKKEEPER, increasing your revenue and increasing your profit margin.
Again, happy 4th of July, stay safe!
Be Bold
Dave