Question: I plan to sell my business one day. What suggestions do you provide businesses that are looking for a way to eventually have the owner[s] successfully leave their business?
Answer: Recently one of my clients sold their business [November 2010]. When I’d started working with him originally as an E-Myth coach he indicated to me that was his goal. It was a very rewarding and happy moment when this gentleman achieved his dream. He well deserved and earned the rewards from the work he put in.
From this example and my work watching similar business owners with the same intentions succeed and fail I feel I can offer some insights into achieving your goal. My first recommendation would be to read John Warrilow’s Built to Sell. In the book Warrilow describes eight steps to getting your business to sell. One of the most important is developing a Standard Service Offering which is trainable and provides extraordinary customer value. The steps are described in my earlier blog, Is Your Business Ready to Sell? You may wish to take his Saleability Index Test as well.
What I liked about Warrilow’s book is that he’s direct in how to approach your current employees. He recommends several ideas on how to keep your current people interested so they help you achieve your desired outcome.
One of the specific steps he recommends is hiring a sales team. From my years as a sales person, sales manager, business owner, and business coach, this is one of the more challenging aspects of selling your business. If you already have a good team or sales person and manager you are ahead of the game. Our partnership with Objective Management Group puts Positioning Systems in a unique position to not only help you assess your current manager and sales team, but also to train and hire the right people to lead or build your sales. With the business owner who recently sold his business, the evaluation and subsequent training we engaged with his sales staff resulted in a 35% increase in revenue in a non growth industry.
Let me provide some insights into how my client got his business to sell. Warrilow recommends finding an E-Myth coach to help you build systems. I completely agree. Michael Gerber’s E-Myth Revisited, Why Most Small Business Don’t Work and What to Do About it is foundational for understanding what you need to do and how to do it in order to get your business ready to sell.
As a former Senior E-Myth Consultant for almost ten years I can tell you that until my client graduated to the Gazelles tools found in Verne Harnish’s Mastering the Rockefeller Habits he was not in position to sell his business. At least not profitably. The tools we initiated through the Rockefeller Habits Four Decisions and executed through Strategic Discipline were critical to getting his business elevated to a position where it was not only attractive to an outside buyer, but also where he could begin to enjoy the freedom he wanted from his business.
Two pieces were crucial in achieving success. First my client embraced the idea of focusing on One Thing. Each year and quarter he and his executive team committed to one priority above all others. Second, he had an unrelenting commitment to customer service. This is a reflection of his humanity and understanding of human nature. No matter what he always observed the ideal that the customer is right. His determined persistence and resolution to ensure his service consistently achieved superior marks from his customers eventually led to his business achieving a marked separation in performance and perception above his competition.
One of the very first things he adopted was a version of the Net Promoter Score. He wanted to know how his customers ranked him, and to make sure when his customer support team improved their response time they counterbalanced this with a balancing metric that indicated this improved customer service effort also improved customers perception of their support team.
My client always remained diligent to the needs of his customers. He treated his people with respect yet was demanding. He would classify as both a Multiplier and Level 5 leader. He is a life-long learner, committed to self-improvement, and perhaps more impressive, he committed to improving the lives of the employees who worked for him.
In Built to Sell Warrilow recommends several steps beyond his eight to someone who wants to prepare their business for sale. As mentioned above one of those is to learn from an E-Myth coach, another is to attend the Gazelles Growth Summit and to learn from a Gazelles Coach as well as Mastering the Rockefeller Habits. As one of just 38 Certified Gazelles Coaches in the World, and a former senior E-Myth consultant, Positioning Systems is in a unique position to offer you the experience in both these areas. Couple this with the tools to help you evaluate, select and train your sales team through our partnership with OMG and my personal 20+ years of sales and sales management experience you have a powerful combination that can help you prepare your business for sale.
If your journey with your business eventually will lead you to sell perhaps now is the time to begin to plan for it. Begin by reading John Warrilow’s book. If we can be of help to you in growing your business to prepare for sale we’d be honored to help.
"Once you recognize that the purpose of your life is not to serve your business, but that the primary purpose of your business is to serve your life, you can then go to work on our business, rather than in it, with a full understanding of why it is absolutely necessary for you to do so."
-Michael Gerber, E-Myth Revisited
"The purpose of going into business is to get free of a job so you can create jobs for other people."
-Michael Gerber, E-Myth Revisited
“One of the first real management concepts that stuck in my head, was that if you can’t afford the people to run the business for you, then all you have is a job, not a business. It was like somebody turning on the light for me, because I realized that I needed to get good people in here to do this for me. I couldn’t keep hiring people at as close to minimum wage as possible.”
- Doug Harrison, CEO The Scooter Store
What’s your One Thing? Click here to download the "Four Decisions” Gazelles White Paper on the Four Decisions you need to get right in order to put your business in a position of salability.