Why paying attention to where you are in the business lifecycle will help you - part 3
Why paying attention to where you are in the business lifecycle will help you - part 3
This life cycle is characterised by a new period of growth into new markets and distribution channels. This stage is often the choice of the small business owner to gain a larger market share to find new revenue and profit channels. Moving into new markets requires the planning and research of an embryonic or start-up stage business. Focus should be on businesses that complement your existing experience and capabilities.
Moving into unrelated businesses can be disastrous.Add new products or services to existing markets or expand existing business into new markets and customer types. Funding is likely to be sourced from joint ventures, banks, licensing, new investors and partners.
The business is built. You have watched it grow and mature, now a whole new set of possibilities awaits. Is it time to buy, sell or merge? Are there new growth opportunities? Have you thought about succession planning? What about estate and retirement planning or family wealth management?
6. Decline phase
Changes in the economy, society, or market conditions can decrease sales and profits. This may quickly end many small companies. Businesses in the decline stage of the life cycle will be challenged with dropping sales, profits, and negative cash flow.
The biggest issue is how long the business can support a negative cash flow. Ask is it time to move on to the final life cycle stage…exit. You may need to search for new opportunities and business ventures. Cutting costs and finding ways to sustain cash flow are vital for the declining stage. Funding is now likely to be restricted to your suppliers, customers and owners.
7. Exit phase
This is the big opportunity for your business to cash out on all the effort and years of hard work. Or it can mean shutting down the business.Selling a business requires your realistic valuation. It may have been years of hard work to build the company, but what is its real value in the current market place.
If you decide to close your business, the challenge is to deal with the financial and psychological aspects of a business loss. Get a proper valuation on your company. Look at your business operations, management and competitive barriers to make the company worth more to the buyer. Set-up legal buy-sell agreements along with a business transition plan.
Find a business valuation partner. Consult with your accountant and financial advisors for the best tax strategy to sell or close down the business.
CONCLUSION
Each stage of the business life cycle may not occur in chronological order. Some businesses may quickly move through each life-cycle phase; some may skip some out all together. Many business owners will choose to avoid expansion and stay in the mature life-cycle stage.
Whether your business is a glowing success or a dismal failure depends on your ability to adapt to its changing life cycles. What you focus on and overcome today will change in the future. Understanding where your business fits on the life-cycle will help you foresee upcoming challenges and make the best business decisions.
If you are interested in understanding more about why businesses fail and what you can do to avoid it happening to your business, I’ve written a short eBook called “7 common reasons for business failure…and what you can do to avoid it happening to you”. Further details can be found at: www.7reasonsforbusinessfailure.com
Why paying attention to where you are in the business lifecycle will help you part 3 - To learn more about this author, visit Mark Gwilliam's Website.
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5. Expansion or transition phase
This life cycle is characterised by a new period of growth into new markets and distribution channels. This stage is often the choice of the small business owner to gain a larger market share to find new revenue and profit channels. Moving into new markets requires the planning and research of an embryonic or start-up stage business. Focus should be on businesses that complement your existing experience and capabilities.
Moving into unrelated businesses can be disastrous.Add new products or services to existing markets or expand existing business into new markets and customer types. Funding is likely to be sourced from joint ventures, banks, licensing, new investors and partners.
The business is built. You have watched it grow and mature, now a whole new set of possibilities awaits. Is it time to buy, sell or merge? Are there new growth opportunities? Have you thought about succession planning? What about estate and retirement planning or family wealth management?
6. Decline phase
Changes in the economy, society, or market conditions can decrease sales and profits. This may quickly end many small companies. Businesses in the decline stage of the life cycle will be challenged with dropping sales, profits, and negative cash flow.
The biggest issue is how long the business can support a negative cash flow. Ask is it time to move on to the final life cycle stage…exit. You may need to search for new opportunities and business ventures. Cutting costs and finding ways to sustain cash flow are vital for the declining stage. Funding is now likely to be restricted to your suppliers, customers and owners.
7. Exit phase
This is the big opportunity for your business to cash out on all the effort and years of hard work. Or it can mean shutting down the business.Selling a business requires your realistic valuation. It may have been years of hard work to build the company, but what is its real value in the current market place.
If you decide to close your business, the challenge is to deal with the financial and psychological aspects of a business loss. Get a proper valuation on your company. Look at your business operations, management and competitive barriers to make the company worth more to the buyer. Set-up legal buy-sell agreements along with a business transition plan.
Find a business valuation partner. Consult with your accountant and financial advisors for the best tax strategy to sell or close down the business.
CONCLUSION
Each stage of the business life cycle may not occur in chronological order. Some businesses may quickly move through each life-cycle phase; some may skip some out all together. Many business owners will choose to avoid expansion and stay in the mature life-cycle stage.
Whether your business is a glowing success or a dismal failure depends on your ability to adapt to its changing life cycles. What you focus on and overcome today will change in the future. Understanding where your business fits on the life-cycle will help you foresee upcoming challenges and make the best business decisions.
If you are interested in understanding more about why businesses fail and what you can do to avoid it happening to your business, I’ve written a short eBook called “7 common reasons for business failure…and what you can do to avoid it happening to you”. Further details can be found at: www.7reasonsforbusinessfailure.com
Why paying attention to where you are in the business lifecycle will help you part 3 - To learn more about this author, visit Mark Gwilliam's Website.
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David BarrDavid Barr is the President of Venture Opportunities, Inc. David has been a professional business broker/intermediary since 1980 focusing on General Business Brokerage and Mergers and Acquisitions representing client transaction value from $400,000 to $20,000,000. Mr. Barr has handled the sale of over four hundred and fifty companies. David earned a university degree from the State University of New York majoring in economics and business. David holds the Mergers and Acquisition Master Intermediary and the Certified Business Intermediary designations from the International Business Brokers Association. He is also a Senior Business Analyst and a Texas licensed Real Estate Agent. For more information about David and Venture Opportunities, visit www.bizdealmaker.com. - Visit David Barr's Website |
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Anne BarrAnne Barr has over 26 years experience in sales and marketing, six years as a franchisee. She has assisted over 367 business owners and purchasers to achieve their goals in career change, transition and exit strategy. She holds the designation of Certified Franchise Executive from the International Franchise Association, Certified Business Intermediary from the International Business Brokers Association and Board Certified Broker from the Texas Association of Business Brokers. Anne is active in professional organizations, networking groups and volunteers for non-profit entities. As owner/operator of four successful businesses, Anne has proven people skills and enjoys helping clients find the right "fit" in business ownership. Visit www.FranchiseOpportunitySpecialist.com for more information about me and my company. - Visit Anne Barr's Website |
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Casey GollanCasey Gollan, Business Coaching & Mentoring Programs. Add $1 Million to $10 Million in the next 1 to 3 years. Since 1996 Casey has to added hundreds of millions of dollars to businesses. Watch a free video see client results Business Coaching website. - Visit Casey Gollan's Website |
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Kim CastleWith nearly two decades in the advertising and design business, with clients like Domino's Pizza, General Motors, Direct TV, Pedigree, Wolfgang Puck, Higher Octave Music, Hollywood Celebrity Products, Disney, and Paramount, as well as thousands of entrepreneurs around the world define, structure, communicate, and position their business for greater profits, BrandU(R) co-creators Kim Castle and W. Vito Montone discovered that entrepreneurs could experience the same power that big brands command for a fraction of the cost with the world's only process-based results-drive Integral approach to business creation. BrandU(R) is helping entrepreneurs grow with the power of extreme clarity from idea...to brand...to market(TM) and helping one million entrepreneurs become successful and whole so that they can make a difference in the world. Are you one of them? If you want to experience clarity all the way to the bank(TM), get started now at http://www.brandu.com. - Visit Kim Castle's Website |
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Jeff FosterWebBizIdeas.com is a Minneapolis website design company founded to help people start an internet business by providing them with website, business, and internet resources that help foster the growth of successful online businesses and develop innovative Internet business ideas. We specialize in internet consulting & internet marketing. - Visit Jeff Foster's Website |
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David AchesonDavid Acheson is the founder of DCJA Consultancy. DCJA Consultancy is a management consultancy business specialising in B2B sales consultancy. They offer bespoke and packaged sales consultancy including Sales Optimisation Review, Interim Sales Management, Sales & Marketing Review, 1:1 Sales & Management Staff Analysis, Management Training, Solution Sales Training, Creation of New Pay Plan, KPI's, run Customer Feedback Campaigns, assist with Recruitment, Coaching, Appraisals and set up Strategic Marketing Campaigns. David spent his early career in accountancy and then moved into sales in 1982, working in Office Equipment, IT, Advertising, Training, Outsourcing and Consultancy. He has held many Senior Positions in SMBs and Global Organisations including Head of Sales Operations & Head of Business Development. His knowledge, skills and great experience of the Sales Industry has led to David making keynote speeches and running educational sessions to key businesses through organisations including The Chamber of Commerce and Business Link. - Visit David Acheson's Website |
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Leanne Hoagland-SmithAre your sales where you want them to be? Will you be one of the few who achieves sales or business success or one of the many who have failed to change? Are you tired of being told you are like everyone else? Then you may find my first book on sales of interest. Be the Red Jacket in the Sea of Gray Suits, The Keys to Unlocking Sales available at Amazon or at http://www.processspecialist.com/red-jacket.htm. This book is a reflection of my no-nonsense approach to improving sales to overall business results. If you are truly committed to making sustainable changes, then I can help you secure a positive return on your investment because I focus on executable solutions not telling you the problems you already know you have. From training to corporate (group) coaching to executive one on one coaching, my approach is to assess, create awareness, build a goal driven action plan and then execute. The bottom line question is "Not do you or your employees know it, but do you or they want to do it?" Please call for a free strategy session at 219.759.5601. - Visit Leanne Hoagland-Smith's Website |
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Cheryl MatthynssensCheryl is a life skills coach, licensed Chemical Dependency Counselor and a 20 year entrepreneur. Cheryl's dedication to achieving a life of balance led to her expanding her teaching from the simple managing of life's daily challenges to adding financial well being as well. A direct marketer with DrinkACT, she is gaining ground in the online community with her concepts of making sure business owners, entreprenuers and employees have well rounded life styles. She opened up a small affiliate site - The Balance Guide- to help others find resources for mental and emotional well being. Visit Cheryl's blog to see more of the diversity beyond business she has began offering online at www.thebalanceguide.blogspot.com - Visit Cheryl Matthynssens's Website |
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