Successful companies evolve over time. It may be necessary to restructure your business to make it more profitable. Typical problems businesses face include acquiring additional capital, shrinking profit margins, unhappy customers, inefficiencies or adopting in an evolving industry. In an effort to address these issues, you may need to add or remove owners, modify ownership interests, change your legal structure, expand operations into other states, sell assets, refinance loans, change operations, add new verticals, remove unprofitable ventures, reorganize business functions, renegotiate contracts or some combination of all of these actions.
In the last article, we looked at what information companies in the Hit and Quit and the Short Range-Long Term needed in order to be successful. In part two of our series, we will discuss the final two categories of the question, How Long Do You Plan to be in This Business?
Before we begin discussing what is needed from a financial standpoint for each of these categories, let me clarify how companies in these categories think. Their thinking is different from the first two categories we discussed in the last article.
Topics: business management
Earlier this year, I presented on a topic called Be the CEO. That presentation mentioned certain questions that should be discussed with your trusted advisor, i.e. your Certified Public Accountant (CPA), Fractional Chief Financial Officer (CFO), or CFO, at the beginning of the engagement. One of those questions will be the topic of a two-part article series, How Long Do You Plan to be in This Business?
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This week marks our firms 20th anniversary. In 1999 my naïve business plan for a “fee-only” and “fiduciary” investment management firm fit on a cocktail napkin. It was me, a phone and a computer. Thankfully, much has changed since inception and hopefully I’ve learned a bit in the process that may be helpful to others.