This article is part one of a two-part series focusing on selling your business.
A record number of small businesses continue to be sold in the United States. Fifty percent of all small business owners are over 50 years old, and it is estimated that over 70% of baby-boomer entrepreneurs will either close or sell their businesses in the next 10 years. Since millennials are looking for business opportunities, and interest rates are still relatively low, now is a good time to start strategizing about how to sell.
With the Tax Cuts and Job Act (TCJA) signed into law late last year, many people have questions about what strategies they should employ. With the end of the year rapidly approaching, now is the time to make plans. Here are a dozen strategies that can optimize end-of-year planning:
One of the biggest mistakes business owners make when they need to improve their profitability and cash flow is to dive right into the details of how to either increase sales or how to identify specific expenses to cut.
They start with tactics rather than strategy.
It is a natural tendency to dive into the details, but in my experience, it usually leads to very little—if any— improvement in profitability. The wiser approach is to take the time up front to consider what you are really trying to accomplish when you are thinking about improving your profitability.
As the rain slows down, it's time to start cleaning up. If your business was affected by the recent rains, that cleanup will take on a different meaning. It’s easy to determine what kind of cleanup effort has to take place if you’re standing in several inches or feet of water. But if you’re a business owner and you’re trying to determine how to clean up with the new 20% deduction for qualified business income (QBI), you may need to look a little harder.
Learn how others do it. Download our guide to growth.
Many businesses choose to operate under an assumed name or a DBA, which is short for “doing business as.” This happens whenever a business operates under a name which is not identical to the official name of the entity filed with the Texas Secretary of State’s Office.
Much of our lives happen on mobile devices, laptops, websites, and an ever-increasing array of online services. So it’s no wonder that our digital accounts and data have become a prime target for hackers and criminals. We frequently see headlines about another website or company getting hacked and the personal data of their users being stolen. As cybercrime continues to get more sophisticated, old security approaches are no match for modern threats and tactics. To address these threats, you can greatly improve your cyber security and better protect your sensitive information by using two-factor authentication.
A business owner wears many hats. The old adage “chief cook and bottle washer” applies in many small businesses. The conventional thinking is that your business is your vision, and the only way to see it carried out is to do it all yourself. Another line of thinking is that because you enjoy handling any given aspect of the job, there is no need for someone else to do it.
Without help, you will only be able to do so many tasks. The tasks that need immediate attention will get done first, because they are the ones that are needed to keep the business running. The short, medium, and long range tasks will seldom, if ever, be completed. This is true if you are a freelance consultant, restaurant owner, manufacturer, or service provider. Most business owners are very good at hiring from the bottom up, but the breakout moment for a small business owner is when they hire or contract for upper management or senior level positions. One of these positions is a Chief Financial Officer (CFO).
I’d like to introduce you to two "financial advisors" named Louie and Hannah.
Louie is our Border Collie that never stops herding his siblings, and Hannah is our adorable (yet neurotic) Great Dane. They are quite cute.
Are you confused as to how they are qualified to give financial advice? You should be.
For most people, hiring a non-qualified person to handle your precious savings is just as silly as trusting your assets to your dog.
In some cases, buying a franchise can be a great alternative to starting your own business, particularly if you have limited experience running a business. The franchisor provides you with a developed way of doing business, trains you to run the business and provides ongoing guidance and assistance with operations, management and marketing matters.
However, buying a franchise does not guarantee success. You will still need to work hard, apply good management skills and serve your customers well.