Categorized | Business Authors

5 Steps to a BIG Payday

5 Steps to a BIG Payday

Justin K. Cauley

A short authors bio

Justin Cauley is a Business Enhancement & Value Maximization Expert who has dedicated ten years to helping small businesses increase revenue, increase profit, and increase and manage cash flow. Justin is an entrepreneur and business development consultant who enjoys working with business owners looking to create a business able to run on virtual autopilot allowing the business to be sold successfully when the owner is ready.

Justin has worked with business owners across the United States and in several foreign countries; his expertise has been used by banks, lending institutions, CPAs, attorneys, business buyers/sellers and entrepreneurs dedicated to taking their business to the next level.

Justin is also the Author “11 Reasons Why You Will Never Sell Your Business For The Money You Deserve: And What To Do About It” Currently available on Amazon.com. He can be reached via his website www.proftimaxsolutions.com

A book synopsis / Key Ideas

Most business owners lack a plan to address the fact that one day they will exit their business one way or another. In fact less than 85% of owners have such a plan in place. Unfortunately this means that the vast majority of entrepreneurs will be disappointed when looking to sell or transfer their business.

11 Reasons uncovers the top causes why business owners fail to exit their company and at least 10 ways owners can improve their chances of increasing the value and sale ability of their company.

Why did you write this book?

I wrote 11 Reasons because the vast majority of business owners and entrepreneurs I’ve worked with were ill prepared when it came time to sell their companies. It has been very upsetting to see an owner forced to close a business with no financial reward in exchange for the risk they’ve assumed. I’ve seen family members and close friends suffer this fate, I decided to do something about it and 11 Reasons was born.

write a paragraph stating why readers should buy your book and what they will get out of it after reading it.

Reader should buy this book if at some point down the road they plan to cash out for their big payday. 11 Reasons will point out the most common and critical errors that prevent virtually every business owner from getting money for their business.

 

Thousands of businesses get started every day by entrepreneurs who hope that someday (sooner rather than later) their new venture will generate enough revenue and income to support a lifestyle of their choosing. I personally know several business owners who are able to live fabulous life styles resulting from hard work, business smarts and business savvy. However they all talk about the one thing that eludes them, the big payday that will set them “financially free”.

When you look at mega rich people such as Bill Gates, Warren Buffet and Steve Jobs you will find that while they achieved great success and financial independence by starting and running their enterprises, they all amassed obscene amounts of wealth by selling their businesses; as a whole or in parts (via going public and selling shares).

Some of you reading this may have a business able to generate a 9 to 10 figure payday—if you do then kudos and good luck! I believe every business can structure or create a business that can generate a 6 to 8 figure win fall. In fact, I know a few entrepreneurs that start or buy a business with the intentions of selling, often for 6 to 8 figures at a time pocketing a nice profit each sale.

According to a leading CPA firm 75% of a business owner’s net worth is directly tied to their business. In other words if your net is estimated to be a million dollars approximately $750,000 of it will be associated and linked to your business. Now what is your net worth if you’re unable to turn your business into cash? Only about $250,000…that’s a huge difference. So how do you increase your chances of cashing out when you’re ready to sell? Statistically the odds are against you; in fact there is only a 10-20% chance you’ll be able to sell. You’ve read that right, 80-90% of all businesses are deemed unsellable thereby severely crippling an owner’s net worth.

I’ve identified 5 parts to place those odds dramatically in your favor.

Part 1: Have a definite strategy and game plan for your business

When you look at your business you have to be able to answer three very important questions.

  1. What separates my business from the competition?
  1. What’s unique about my product or service that I can offer as value to my customer?
  1. What can I do to increase and build upon that value?

Businesses unable to honestly answer the questions above are leaving themselves vulnerable to stagnant, flat sales however even that is better than the alternative…failure. A small business development strategy has never been more critical than in our current business environment. It doesn’t matter what sort of business you are in, a company can’t get by without a small business development plan.

Part 2: Keep accurate and clean financial records

Before you start the process of selling a business it’s important to get your financial house in order. Start the process of creating financial statements on a monthly basis and no later than on a quarterly basis. Use these reports to track and monitor your business performance, over time these reports will allow you catch and correct problems before becoming too big to correct.

We all know cash is king; cash flow is one of if not the most important aspect of selling a business for top dollar. Effective small business management revolves around the management of cash flow—having enough capital on hand to keep your company moving forward and to increase your company’s value in the long run.

Lastly, every business should make a habit of creating financial projections on an annual basis. High performance companies plan for the next year immediately after closing the books on the current year; this is a good habit to develop and implement. Having financial projections and a budget are two great tools that can help put your business on the path to growth. Sadly they are also too often overlooked by small business owners.

Part 3: Keep your customers happy

Your customers are the number one source of revenue for your business. No customers equal no revenue, spend time and cultivate those relationships. Build and maintain your customer database, learn their likes and dislikes and figure out ways to create customer loyalty.

Once you’ve done all those things make sure you maintain and grow those customer relationships accordingly. It’s much easier and cheaper to sell to someone who has already brought from you than try to make a new sale completely via new customer acquisition. So once you get a customer make sure and hold on to them.

By simply reaching out to your prospects on a weekly or monthly basis with a new offer, an exclusive deal, a product update etc., you will greatly increase the odds of getting and increasing sales over time. Please do not be apprehensive towards the aforementioned, making connections doesn’t have to be a complicated task. Staying in touch and reaching out frequently goes a long way toward building trust—trust is the key to finding life-long customers.

Part 4: Set quarterly and yearly goals

Do you let the market environment dictate what you are currently doing in your business or do you run your business with vision? There is one word that separates these two types of entrepreneurs that word is planning. Successful small business owners use planning consistently in their business management processes. Proper planning helps to make great decisions both long and short term. A business can successfully expand or contract and remain profitable in any economic condition through proper planning. I believe it is lack of planning that causes so many small businesses to fail.

Planning allows you to make a decision before you’re forced to make a choice. Every business owner should want to make decisions regarding their operation on their own terms. Hasty or abrupt decisions can lead to fatal business errors. Everyone hates to be rushed when making a choice.

Part 5: Create a business exit plan

Start with the end in mind. Remember if you don’t know where you want to go you will never know when you get there. Think about what you would like to gain from your business personally and financially then make a plan to reach that goal. For any business, a strategic business plan that incorporates exit planning is instrumental to ensuring your company has clearness in direction and a unified vision for growth and eventual transfer.

A business development consultant will help you create an exit plan to assure your business moves forward in the direction you want. In developing your plan, you have to break your company down to the core components and look for anything that may hurt the value of your company.

Design and create a strategy that will separate you from the competition and get you the most money in the end; this is what exit planning is all about and it’s key to profitability and growth. Creating a strategic exit plan doesn’t have to be terribly complicated, some plans can be completed on one page.

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