Save content
Have you found this content useful? Use the button above to save it to your profile.

Start your business planning at the finish line

25th Mar 2015
Save content
Have you found this content useful? Use the button above to save it to your profile.

Once you know where you're headed, the journey is all the easier. Sounds obvious, right? But in business, it can be so easy to get sidetracked by the initial excitement of launching a company and all the energy it requires, and then get bogged down in running it. This often makes it seem as though there's no end at all – you just keep churning away. 

Unless you're planning on having your business for the rest of your life – and why would you want that drudgery when you could be off enjoying your golden years, or delving into other business opportunities? – you should sit down and work out what you want and how you're going to get there, before you even get started with a new enterprise. This means not beginning at the start line, but beginning with the finish line instead.

After all, if you don't have firm, achievable goals, how are you going to get anywhere? If your end goal is to sell off a business you've successfully built up, which is the case for many businesspeople, picture yourself at and after the finish line and ask yourself what you see. Your thriving operation in new hands and a big pile of cash for you? Great. Now start working backwards.

All in the mind

Let's assume that before you even start your business, you want to sell it within a certain period (for example, in 10 years) and let's also put a value on it: the amount you'll expect to get for your company. How does £15 million sound? These two figures must be in your mind at all times, and everything you do, from hiring staff to installing new systems, must be done with the goal of reaching them.

Also ask yourself, at the outset and all the way through the life of the company with you at its helm, what a potential buyer will look for. Yes, sales and profits, but also there are many other elements too, including the long-term viability of the firm. They won't want to invest today only to end up with a floundering operation in a few years' time.

Are you going to make the greenhorn mistake of ensuring the company revolves around you and can't be run without you? From the very beginning, it's important to delegate. Don't be afraid to let go before you've even taken the reins. It will make your business life a lot simpler and allow you to focus on the end-game. When you feel the urge to jump in and take control, always tell yourself: no one's going to buy a business that can only be run by the seller – it will quickly crash and burn. So, adopt a hands-off approach while also firmly guiding your business along. 

Looking great in two hats

In order to achieve the sale you want, when you want, constantly keep in mind what an investor (or group of investors) might want when buying your company. It means having to wear two hats: that of a company owner and a potential buyer. For instance, it's entirely possible that your firm might be scooped up by a business rival so that they can expand their market share and offer additional products. So how might your fledgling enterprise be a good fit for some of your current competitors?

Getting into business is one thing, getting out of it – unscathed and with a big payout – is something else entirely. Many businesses fail along the way, and many business owners fail to snare buyers because of an inherent lack of focus and attainable goals. By making your starting point the finish line, however, you stand a much better chance of going the distance and getting the rewards you deserve.

Andy Hyland runs A K Tax, a firm of accountants in Medway, Kent working with small business owners helping them with tax and business advisory services.

Andy has a wife, two children, and two cats (but would prefer a dog). He hopes to live long enough to see England lift the Rugby World Cup once more.

Tags:

You might also be interested in

Replies (0)

Please login or register to join the discussion.

There are currently no replies, be the first to post a reply.