"Leave Well Enough Alone"

In the arena of closely held businesses, owners are often the founders and the most productive elements of the business. When a business succeeds and consistently earns a profit, the owner, serving as both producer and policy-maker, can make the decision to "leave well enough alone." Doing this, however, ensures that the owner will not realize the maximum value from the business. Chances are, if you founded the business, you are the best producer for the business. Also, as a business owner, the success of the business is likely attributable to your ability as a manager. You have built a team and established a successful business system with your production and management skills. In a competitive business environment, your success – the business achieving profitability – will be reverse-engineered and copied. If you do not grow and improve – change – your competitors will take your profitability away. If your concern is to receive maximum value from your business, you must move out of management and at the same time improve the business. This is not "leaving well enough alone." As the owner of a business interest in a profitable business, your primary concern should be to realize the maximum value from that interest. To be precise, "realize maximum value" means receiving the most net cash for that interest, thereby converting the value in the business interest from a high-risk business ownership to a personal asset held at a relatively low investment risk. This occurs when the sale of a business interest is a wealth-building event. Put yourself in the role of a sophisticated buyer of a business. What is it you want from a business? Fundamentally, you want an established system of profitable operation. If the most important part of that business, be it a producer, a manager, or both, is the selling owner who is going away right after you buy the business, that is a negative factor causing you to devalue the business or not purchase it at all. Moreover, if the business is incapable of change, it will not grow and stay ahead of competition. An owner seeking to sell a business for maximum value will work to become less involved and instill a business process that can adapt to maintain profitability. The change from producer and owner-manager to owner creates wealth for the owner and the owner's family. It is not easy, but neither is founding and maintaining a successful business. Generally, owners who have created a successful business are quite capable of following Prior Diligence and executing a plan to create increased value for the business interest. Using Dynamic Planning, the strategy is implemented in a way that consistently revises and improves the actions taken to reach the goals of the business plan. If you want increased value and wealth for you and your family, adopt a strategy that will stop your productivity and management activity. That strategy should be the basis of a business plan that will cause that change and other changes. That strategy is called Prior Diligence. The planning for that strategy is Dynamic Planning. Find out more about the Prior Diligence strategy and Dynamic Planning at the Business Transition Consulting website, (btcllc.net).