Statistics Help when Selling your Business
There are many ways to measure the operating success of a business. The most obvious way is via the Profit and Loss and Tax returns. Another tool can be testimonials or customer feedback. A different and now more common tool for some businesses are results from Social Media with, for example, the number of Facebook likes, the number of Twitter or Google + followers.
In a previous article called “Why a business does not sell,” I looked at three reasons why a business does not sell and more importantly, what the owner can do about it so when they are ready to sell their business it increases their chances of the business selling.
Here is reason to start collecting data about the performance of your business and why it will come in handy when you are ready to sell your business.
Seller does not measure the success of the business
For the past 15 plus years my wife and I regularly go to a local bakery for a Sunday breakfast. We enjoy the food, the design and atmosphere of the bakery. In fact we enjoy it so much the drive takes us about 12 minutes and we pass two other bakeries to get to this one.
When we arrive there are two different queues to place our order. One queue is for bakery items and a different queue is for a cooked breakfast. Sunday morning is busy and so often one queue has no one waiting while the other has many customers waiting. The bottom line is that it appears poorly organized.
Despite my wife and I going for 15 plus years and seeing this same problem week after week there is no place to provide any feedback. I’ve seen many customers walk out and I’ve heard customers complain to other customers but it’s the one negative in what otherwise is a very positive experience.
How the seller can fix not measuring the success of the business
There are many ways to measure customer satisfaction or solicit feedback. A simple feedback card and pencil with a place to put completed feedback cards would be incredibly cheap.
The owner already collects business cards to send out monthly specials. It would be so easy to use that list and request customer feedback via an electronic survey with an online marketing tool such as Survey Monkey or Constant Contact.
In addition, many customers express their opinion on Facebook, Twitter, Yelp or other electronic social media forum. It’s not complicated, just takes a bit of effort and good business to measure and manage it.
Statistics help when selling your business
As Peter Drucker, the author of Innovation and Entrepreneurship said “If you can’t measure it you can’t manage it.”
The above are also examples where the Profit and Loss or Balance Sheet are unable to help. That is, there’s no way for the owner to know how much business he’s losing as he doesn’t know and doesn’t measure it.
The main way to hear of lost revenue opportunities is to get it from the source; which is the customer.
Are you thinking about selling your business and move to your next challenge? Would you like to know the value of your business? If you would like more information please visit my website Business valuation.
For more immediate, give us a try with an email to Andrew Rogerson or give me a call on 916 570-2674.