Every business owner and manager should seek new ways to increase company value. Even if your business's revenue is at an all-time high, there is still room for improvement. The question is how to go about enhancing value. Consider the suggestions detailed below and you might find increasing the value of your company proves easier than expected.
1. Re-Brand Your Business or Create a Brand
Most businesses have an established brand with a recognizable name and logo. If your business has not invested resources into establishing a genuine brand, the time to do so is now. Those with an established brand will find rebranding really does add value to a business. Businesses with a brand that has gone stale and those reliant on older tech for operations will find a rebranding effort to be especially helpful.
Companies that have recently added services or products that do not fit the current brand will find rebranding helps establish familiarity with prospective customers. Once your offerings jive with your brand, customers will prove that much more responsive to your marketing efforts and online presence. If a total re-brand is out of the question, consider re-launching a product or service with some new features tacked on. This effort will draw attention to your business and help you connect with new customers.
2. Find a Way to Make Your Team Fungible
The best businesses are staffed with “utility” employees who function similar to interchangeable parts in a machine. If someone leaves for a new position or takes a vacation, another co-worker should be able to step in and complete the departed workers duties without interruption. It will help to establish and document repeatable business processes. This way, anyone can follow established protocols should another team member miss work, find a new job, fall ill or need to tend to a personal matter.
3. Expand Your Customer Base
The most successful business owners never stop looking for new customers. The addition of new customers will enhance your business's value, especially if these new customers are fairly young. Try to diversify your customer base just in case a target demographic begins to lose interest. This way, you will have a number of interested parties willing to pay for your services and/or products across posterity.
4. Develop a Recurring Revenue Stream
The general rule of thumb is no more than 15% of a business's revenue should stem from a single customer. Continue to add revenue streams as your business matures. Ideally, you will add a recurring stream of revenue that provides returns in the months and years ahead. Recurring revenue streams really are the gifts that keep on giving for business owners and managers. If your recurring revenue streams prove predictable and grows on a year-over-year basis, outsiders will value your company that much more. More importantly, you will enjoy an invaluable peace of mind as a business owner knowing your company has a reliable source of recurring revenue.
5. Reduce Expenses
Do your best to cut costs where possible. As an example, some small businesses cut costs by sharing overhead expenses with others in co-working spaces. Cutting costs ultimately boosts profit and maximizes company value. A creative way to reduce expenses is regular maintenance that improves the efficiency and functionality of current equipment/infrastructure. Once you have trimmed the fat, your business's value will increase right away. Just be careful to refrain from over-trimming costs as excessive cost-cutting can make it difficult to serve customers and retain valuable employees. Find the right balance and your business's value will increase in due time.
About the Author:
Marla DiCarlo is an accomplished business consultant with more than 28 years of professional accounting experience. As co-owner and CEO of Raincatcher, she helps business owners sell their business to get paid the maximum value for their business.
About the Author
Steve Smith is President and Founder of GrowthSource Coaching headquartered in Lake Forest, CA. He is an accomplished leadership, management and organizational enhancement coach who brings over 40 years of business building experience to every client relationship.