The shoedown: sell, transfer or keep your business
Are you expecting to die with your boots on? Or do you intend to kick off your shoes and seek other surroundings, near or far?
Some eight per cent of us who own small businesses in Canada do not plan to retire at all.*
Others would like to keep a guiding hand in their businesses but clear more time for themselves, shedding the day-to-day weight of operational concerns.
Have you thought about your options? Proper “exit” or business succession planning will help you sort out the implications each has for family, funding and taxes. The starting point will be your retirement goals and the provisions you need to get there. Continue reading →
How many miles have you put in on your business journey? Are you still enjoying the ride?
Maybe you’ve started thinking about passing the wheel and your business to someone else.
Will you have enough money for what you want to do next? If not, what will it take to get you there?
Putting value in your tank
If you don’t know what your business is worth today, on what basis are you making decisions for tomorrow?
Yet that’s the case for many small- and medium-enterprise owners in Canada who are counting on their business for their retirement nest egg. Continue reading →
Who better to thank than the spouses who stand beside or behind us in our businesses.
Our life partners often don’t get the recognition they deserve. In family businesses, it is often the wife who does not take a formal salary or title.
And when they don’t work alongside us in the business, what they contribute to its success can be out of sight, out of mind.
Business owners tend to work long hours, especially in the early years. Moreover, when we enjoy what we’re doing, we don’t even notice how much time we’re putting in and how much energy we’re expending. Suddenly it’s 9 o’clock at night and we’re still in the office or store. When was it we said we’d be home?
Arriving home, we find it hard to break the connection to our business. The issues of our day still draw energy—like the TVs, computers and other plugged-in devices that continue to draw standby power even though they’re turned off. Our brains are still receiving work signals while we should be tuning in to our significant others.
In some ways, they are our standby power, allowing us to achieve our dreams, helping us to hold it all together, through the uncertainties, the ups and downs, the ebb and flow of money. In owning your own business, you are paid only after all of the other expenses have been paid.
A supportive family is essential—it may be your name on the business, but owning a business is truly a family undertaking.
I have been very fortunate over my many years in business to have a wife who rode the financial ups and downs and put up with the long hours and extensive travel with understanding and without complaint. I believe that without this support at home it would have been impossible to have achieved the same business success. Thank you, Gayle. And Happy Valentine’s Day!
What about you? Has your spouse contributed to your business? Want to publicly thank them? Go ahead—use our comments to do so.
What about owning a small business that only operates at certain times of the year—say a tour boat line in Canada?
I saw an article recently about owning a seasonal franchise and it prompted me to put together my own list of pros and cons to owning a seasonal business that buyers should be aware of.
Being the former owner of a tour boat line in Canada I have lived through them.
Owning a seasonal business: the pros
During the off season the owner can work on business planning, marketing programs, operating systems and procedures, documentation, research and so on without the pressure of managing the day-to-day operations.
The off season provides time for rest, contemplation, leisure travel and activities, and to get re-acquainted with family and friends.
The off season provides time for meeting with industry peers, trade associations, suppliers, strategic partners, and for traveling to research potential business improvements.
The off season may allow the owner to escape unpleasant weather conditions.
Recruiting and training can be done in advance of the busy season when there is time to do it well.
Servicing and upgrades to systems and equipment can be done during the off season without time pressure.
Some people thrive on being the hare rather than the tortoise.
Owning a seasonal business: the cons
Start up at the beginning of the season requires working capital in excess of what a non-seasonal business would require.
Start up requires a significant expenditure of energy is a short period of time.
The resources allocated to the business are only earning a return during part of the year.
A system or machinery breakdown during the busy season is more costly and thus the risk is higher.
It is more difficult to retain good employees in a seasonal business.
The level of activity in a seasonal business must be much higher during the season to offset the slow or down time and so may require long hours and greater endurance from the owner.
The level of stress dealing with a flurry of activity during the season can be higher.
In the end it is a personal choice based upon the owner’s values and what he or she enjoys.
How about you? Have you operated a seasonal business? What did you like best about it?
Jumping into a pool isn’t top of mind for most of us as we hunker down to face our Canadian winter. But that’s one of the things my team and I were thinking about earlier this week as we learned about the traits and preferences of the four DISC personality types. Our training leader (Grant Mellow of ActionCOACH) used the pool analogy to help us grasp the differences between each so we could recognize them and adapt. We’ll “dive” into the details a bit later, including some tips you can use in communicating with your own team and customers. First I want to tell you why we were going through this exercise.
Most of you, like me, are business owners. We in particular have to be able to adapt to changing times and circumstances in work and life. Sometimes we need to learn new skills as do our employees. Such changes are harder for some than others. But once mastered, the individual and the business both benefit from the growth.
My recent changes include a series of steps to increase the number of businesses we have available for sale (our inventory) and closings (our sales). Among these are systems and training to better equip our team and their clients for success. The DISC exercise was structured to help us communicate with our prospects and clients in a manner that works for them.
While we’re a professional services firm, we are also a store. When buyers come to us, it’s important that we have the right business to enable them to be successful; to do this, we need to have significant inventory with a mix of every size and kind of business for sale. That was never a problem before the recession. But because of it, many owners have delayed selling, thinking there wouldn’t be a good market. [That’s wrong—businesses are still commanding a good price, although it will shift to a buyer’s market in a few years when baby boomers start to retire.] Continue reading →
Some 52% of Canadians go online to research products, says the November issue of Profit magazine. If your store doesn’t have an effective web presence, you’re going to sacrifice sales, they add.
And yet, many small businesses in Canada still don’t have a website. Only 36 per cent of small businesses had their own websites (compared to 91 per cent of large businesses) as of 2007, a recent CBC article reports.
Surprised? I’m not.
I encounter this often, when owners enlist our help to sell their business—many do not have a website.
They don’t realize the bad image it conveys—that you’re not professional enough to have a site. And it’s just as damaging if you haven’t kept it current. Think of the website as your online home. Are your premises tired and dated?
An effective, well-designed website will give visitors a positive impression of your business. But the site needs to be consistent with who you are or want to be as a business and directed to your target market—your prospects. As with all marketing channels, you need to determine the audience you are trying to reach and with what message—with the ultimate goal of gaining a customer or client.
With this in mind, we took a long, hard look at our own Sunbelt Canada website this past spring and realized it didn’t convey all that our company had to offer. So we overhauled the site, to make it more relevant to and functional for our target audience—people interested in buying, building or selling a business–to attract more visits and ultimately, more customers.
Instead of just pointing out the improvements, I wanted to share some of the thinking behind the changes, so you too could benefit. Continue reading →
I’ll admit it—I’m a packrat. I hate throwing something out that may be useful to someone else or to me in the future. It took the discerning eye of my wife, Gayle, for me to clear out all the equipment and material I’d stored in the large vault being converted into a new learning space at Sunbelt’s Ottawa office. The existing meeting rooms just weren’t big enough to accommodate the number of people wanting to attend our business seminars or broker training courses. So over the past few months, we’ve been renovating, and we’re now in a position to host more learning opportunities for more business owners and prospective business owners, starting with a series of free evening seminars on “Exit planning for business owners.” We’ll have more details shortly.
Whether you’re thinking about selling now or several years from now, proper planning and preparation can make a significant difference in the outcome of the sales process. We encourage all business owners to understand and take control of the factors that affect the value of their businesses and to constantly build for maximum return on investment.
Have you read our three posts on how financial, organizational and operational factors can help you build value in your business? If not, you might want to do so now:
How’s your fiscal fitness? Get tips on financial factors to build the value of your business.
Can a potential buyer see himself in your business or are you blocking the way? The greater value comes when the business is making money without its owner’s involvement in the day-to-day activities. Read more about the organizational factors that build value.
Some operational factors–the state of your shop, warehouse, office, store–are fairly obvious, but do you know how your systems or lack of them add or take away value from your business?
And if you want to reserve a seat at our Ottawa Exit Planning series, please indicate your interest by registering here. We’ll have more details shortly. Or if you’re outside Ottawa and you’d like to be notified when we have added an event on buying or selling a business in your area, use our contact us form to request this service.
How many of you remember Victor Kiam, the businessman who liked his Remington shaver so much he bought the company? Well, the three Inner Circles I experienced in the U.S. impressed me so much that I bought the company – at least the Canadian Master Franchise.
Kiam said (and showed), “Entrepreneurs are risk takers, willing to roll the dice with their money or reputation on the line in support of an idea or enterprise. They willingly assume responsibility for the success or failure of a venture and are answerable for all its facets. The buck not only stops at their desks, it starts there too.”
Membership in an Inner Circle group can substantially improve the odds for entrepreneurs like us rolling the dice. In a recent member survey, 97% reported better decision making ability; 75% reported higher revenues AND profits; 71% reported better work/life balance.
So what is the Inner Circle and its life- and business-changing power? Continue reading →
Two posts back, I wrote about the value of taking time out for vacation, to recharge, to clear the mind and get fresh perspective, good for our health and our business.
Perspective is everything in business as in life. It’s what maintains us through the challenges of the economy, the marketplace, the unknown and the unforeseen.
Success-oriented small business owners are prepared to step outside of the familiar, the tried and true, and they are open to other ways of thinking and doing. They are curious, always asking questions, looking for ways they can create value. They are not afraid to act.
This week, a friend recommended I watch a TED video she had found through a blog post by staffing industry executive Susan Wright-Boucher. As Susan says:
“We go to great lengths to prove we’re right. We defend our point of view when challenged. We debate and argue to get others to see things our way. And yet we celebrate movies and books that surprise us with plot twists and red herrings just so that we can enjoy the feeling of being wrong when we get to the end of the story. What happens to us in real life that compels us to be right? Are we missing opportunities to be surprised and delighted?”
And, from a business perspective, I would add—opportunities to surprise and delight our customers.
It’s been said that “in order for you to profit from your mistakes, you have to get out and make some.” Based on what Slate columnist Kathryn Schulz says in her recent TED video, to start the ball rolling we have to “let go of rightness.”
Kathryn talks about the need to “step outside of that tiny terrified space of rightness,” reflecting that we limit ourselves and our personal and professional relationships by our fears of being wrong and inadequate.
Most of us will do anything to avoid being wrong. So we pump up the confidence we have in our convictions. And that can lead to tunnel vision, tempering our acceptance of other points of view. As Abraham Maslow said, “To the man who only has a hammer, everything he encounters begins to look like a nail.”
That’s no way to build relationships and resolve issues that can make or break a privately owned business, be they with customers, suppliers, or staff. It’s the same when it comes to buying or selling the business, where give and take, and the need to listen to and understand the other party’s position, is needed on both sides.
I encourage you to watch the video. Let me know what you think.
And if you haven’t done so, grab my RSS feed at the top right or subscribe by email to the Real Deal using the SUBSCRIBE BY EMAIL in the right-hand column. You’ll be the first to receive new posts hot off the press.
Are you taking, or have you already taken, a vacation away from your business this year?
If your answer is yes, good for you!
If not, what’s stopping you? Think twice before you answer.
As a business owner myself, I know how hard it can be to step away. And provided you enjoy what you’re doing, the workload seems much lighter than it actually is. I touch on this in tips for baby boom buyers. Sometimes you don’t even notice how much energy you’re expending.
But that can be part of the problem. You may not be able to separate yourself from your business. It’s important for owners to make their business independent of them: they’ll have more flexibility in their life and their business will be worth more when it’s time to sell.
We all need time to wind down and recharge, to clear our mind and get fresh perspective. And vacations are a way to do just that. They’re good for our health and our business.
Save time and money by learning from an expert before you buy or sell a business in Canada.
Over the many years I've been in business, I've been privileged to help hundreds achieve their dreams.
Greg Kells is President of Sunbelt
Business Brokers, Inc., the Canadian offices of the world's largest and most successful network of business brokers.
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