What Do I Have? Gaining a Better Understanding of Your Business

By: Garry Krum, Agora Founder & President

September 2, 2023

Over the years spent working tirelessly to build, manage, and grow your business, it’s surprisingly easy to lose sight of the big picture: your company as a whole.

How much has the industry I’m in changed over the years? Can I expect consistent, quarterly growth? How much is my company worth–not just to me, but in the eyes of a prospective buyer, too?

It’s only natural to have somewhat of a myopic perspective of your business, despite your best efforts to see the entire operation holistically. Agora Strategic Consulting Group has helped numerous companies get a better sense of “what people have,” identifying the value of details small and mundane to the glaringly obvious.

What Do I Have?

It’s a simple question, but a good answer requires thorough deliberation. The first of three essential questions any business owner must ask themselves, “What do I have?” concerns all aspects of your company–no area is worth overlooking. Below, we’ll provide you with some key points to consider when analyzing your business to determine its worth, as well as a greater understanding of your company’s strengths and weaknesses.

Self-Assessment

Organization and proper record-keeping are key to self-assess the current state of your business, look back at the past, and generate (semi) accurate projections for the future. The best time to organize and secure important financial documents was yesterday, but the next best time is here and now.

Before you dive into the nitty gritty numbers, ask yourself:

  • Has my business achieved realistic but desirable growth at its current stage?
  • Are my employees happy, healthy, and satisfied with their work?
  • Am I personally and professionally in a position where I can begin to think about my exit? If so, what comes next?

The truth to these questions may be daunting and, at times, challenging to face. Nonetheless, it’s essential to be honest about your business to gain the best possible understanding of what you have.

Financial Analysis

Even if you’re not an expert in business valuation, you are the principal expert of your business–it’s your company, after all! It’s worth exploring different valuation methods including Market Approach, Income Approach, and Asset Approach, which valuate your business relative to competitors who’ve sold, projected future earnings, and the sum of your tangible and intangible assets, respectively.

Make sure to collect and organize valuable documents such as detailed financial statements, income statements, balance sheets, and cash flow statements. This data is necessary during a valuation process, even if it’s an informal initial overview.

Market Research

Your industry, local competition, and the way the market operates has likely dramatically changed if you’ve been in business for multiple decades. Savvy business owners know how to stay ahead of the curve to stay cash flow-positive and retain long-time customers, but seldom do owners think about what’s changed in the context of selling their business or handing it off to someone else.

Taking some uninterrupted time to research your industry, target market, and competitors will prove useful in better understanding what has or hasn’t changed. During this research, you’ll also gain insights into industry trends, growth rates, and the nature of the competitive landscape. Ultimately, you should feel confident in how your business performs relative to others.

Agora Helps You Discover What You Have

The above points are always worth considering and exploring when it comes to better understanding your business, and thus, better positioning yourself for an eventual exit. However, we understand that finding the time and making the effort to properly assess your company is easier said than done.

That’s where we step in. As a start we offer a complementary three-step Exit Ready Review. Agora Strategic Consulting will help you feel confident about where your business stands, what changes you may need to make, and how you can better position yourself and your business for a smooth, successful exit:

  1. Business Overview: We conduct a high level discovery process to better understand your business and timeline expectations.
  2. Preliminary Assessment: We will do an initial assessment around three questions; what you would like to achieve in a transition, your businesses’ current ability to meet those expectations, and your future plans to guarantee success.
  3. Exit Readiness Overview: Following the review, you’ll be given an Initial Exit Ready Assessment which will provide you with some initial recommendations on how to achieve better clarity on what specifics you will need to position your business for exit success, meet your goals, and create a business that will attract the right buyer.

To learn more about what Agora Strategic Consulting Group can do for your business, please contact us for an obligation-free Exit Ready Review interview. We also encourage our readers to take a deep dive into building unique value in their business by reading our bookThe Value Equation.

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