true value
for you as the owner; it is a good investment. Most people say they don’t want to sell their business, because in their hearts, they know they have nothing to sell!
Truth be told, there are very few small businesses on any given day that are “ready to sell”. Owners always want to clean up the place; increase sales a bit, make that big deal that really turns the corner, and hire that key person that will make all the difference. You know, when the business is “ready”.
The Problem Might be Your Success. In the scenario above, the successful owner of the business knows the customers intimately, and is a
ready source for employees who need answers. So, what happens when you are not there? Do sales go down because you have not engaged the customers who love you? Do employees defer decisions “until the owner gets back”, and slow progress? Your absence could dramatically impact the value of the business.
You Are Not For Sale. Therein lays the challenge for the prospective buyer. You cannot sell yourself. If the true value of the business is you, what is lef t, essentially is “stuff and storage”. The value of the enterprise is essentially liquidation value.
If the “stuff and storage” is put together nicely, there is some added value since the new owner won’t have to renovate to open. If the lease is solid, in a good location, you get points there, too. If you have staff that is loyal and loves the business, a few more points -- but, you can’t really sell them either, can you?
Now, before you dismiss all of this by saying, “I have no intention of selling…”, go back and read the first few paragraphs in this column. We are talking about how you can value your asset. If you are the centerpiece, you do not have a business asset. You have assets that you can “liquidate” in a sale, but not a “going enterprise” that continues flawlessly whether you are around or not.
The Key to Creating Value. It is simple -- and difficult. Replace yourself. I don’t mean hire someone to do what you do. What I
encourage you to replace is the value of your presence. That means teaching what you do: making your “spirit” operate the store, not you. Your spirit is captured in words and deeds. You demonstrate your vision for the store and teach it from the moment you hire a new person. You codify your process -- including the handling of customers -- in writing, in a Systems Manual. There should be no questions or situations that are not covered by the Systems Manual.
“Let me show you how it works!” To help you better understand the rationale behind having systems at all, and why they are the
absolute key to your achieving True Value, let’s do a little “out of body” experience. Suppose you are outside of your business looking in. You have successfully put your business together and you are considering selling it and doing something else. You are describing it to a stranger – someone who could be a prospective buyer of your business. Properly prepared, you have the freedom to say, “Let me show you how it works!” Never say, “Let me show you what we sell.” You get to show
46 scrapbook business
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