You may not be considering selling your business now, but is there any possibility you will in the future? If so, there are several things you can do now to increase the value of your business in the future. Here are five of them.
Hire the Right People
A quality workforce not only adds to the value of your business when it comes time to sell, but hiring the right people also helps you grow your business to begin with. If a new owner takes over, they’ll want to know you have the right people in place to continue to grow the company. An experienced and quality workforce will help them do just that.
Build a Memorable Brand
Building a memorable, well-known brand will help you stand out against your competition and, in turn, should help grow your business. To create or strengthen, you’ll need to hire or outsource an expert with proven results. It can be difficult to place a hard value on a brand. Here’s a little more on the value a brand can carry and how to calculate your brand’s value.
Keep Comprehensive Records
In one of my recent articles, Tips to Sell Your Small Business, I outlined some of the records you’ll need in order to sell your business. These include purchase records, contact lists for business partners and providers, operating manuals, and the like. From documenting business processes to purchases to revenue growth, tidy records will be an asset when it comes to selling your business.
Increase Revenue Year-Over-Year
As a business owner, you’re probably always looking for ways to continue to grow. And that’s exactly what you’ll need to do to increase the value of your business down the road. Proof of continuously increasing revenue is what potential buyers want to see, and it will cultivate a higher valuation.
Generate Recurring Revenue
One type of revenue that can sometimes be overlooked is recurring revenue. But generating this type of revenue can be very valuable when it comes to the sale of your business. This is because recurring revenue will generate income for the new owner right away. Recurring revenue streams can be created via subscriptions, contracts, or the like.
Even if you’re not considering selling your business right now, if you think you might consider it in the future, do what you can now to increase the value later. And hey – if you don’t end up selling in the long run, all of these things will help you build a lucrative business in the meantime!