Many business owners aren’t familiar with the principles of accounting. They need to understand their profit and loss statements and balance sheets so they can make good management decisions. They also need to understand their financials when dealing with banks, taxes and negotiating for the sale of their company. If… Read More »Tip #034 Business owners need to understand accounting!
Many business owners and their accountants are absolutely fixated on minimizing taxes by showing no income. But this can be misguided planning for trying to get top dollar when selling the company. Business owners need to realize valuation is usually determined by a multiple of identifiable cash flow and that… Read More »Tip #33 Minimizing income taxes – short term strategy or long term mistake?
Yes, it’s overwhelming. There is so much new technology invading our world it can be hard to understand and realize it’s impact. Business owners have to figure out what might help their businesses grow. Whether it be email campaigns, social media, e-commerce, more functional websites, cloud computing or new equipment,… Read More »Tip #32 Business owners must take advantage of the new technologies!
Most business owners think their business should be priced more than it’s worth — mainly because of all of their hard work over the years. But they have to realize there are certain economics and realities that dictate the price. Besides the various methods of business valuation, the cash flow… Read More »Tip #031 Buyers and Sellers usually have a very different view of the value of a business.
The days of the 5 and 10 year business plan are long over – everything is changing at such a fast pace. Business owners need to review their plan to determine what has already changed and forecast what could change – competition, technology, demand for the product or services of… Read More »Tip #30 Time to revise the business plan….. again!
Whether applying for a loan or selling the company, business owners must be prepared to disclose EVERYTHING. The business needs to look good — in all areas. To not be disappointed, business owners must plan, address weaknesses, and be realistic in their expectations if they don’t have solutions.
Most retiring business owners expect that their financial needs will be met when they sell their companies. Unfortunately, that is not always the case. Business owners should have a business valuation performed by an independent professional and then create an “Exit Plan” to close the value gap if one exists.… Read More »Tip #28 Without a plan, business owners could end up with a “Value Gap”!
The most popular method of valuing a business uses a multiple of earnings over a period of years. Business owners should be aware of that while attempting to reduce the bottom line with personal expenses to minimize taxes. Though there are a number of deductions that may be added back… Read More »Tip #25 Burying excessive personal expenses in the business financials can lower business value!
Unfortunately, there are businesses whose market has changed so drastically that their products or services now have limited demand. And it might not be the economy! Those business owners may have to consider a whole new business model and get into the research and creative thinking mode. A good starting… Read More »Friday Funny Tip 24-Some businesses may need a whole new direction!
The title to the 1969 song by the Rolling Stones seems to echo what the market tells some business owners. Many times the offers for the business are not what the seller would hope for. But if there are offers on the table, a business owner must take a hard… Read More »Friday Funny Tip 23 – You can’t always get what you want!