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Peter Drucker, father of modern management, once said, “The purpose of a business is to create and keep a customer.”  That makes sense, but somehow we lose track of it in our pursuit of fixing problems and refining our processes.      Never forget, it’s all about the customer.    Keeping a customer starts with customer satisfaction.  Seems pretty simple, but the business world is a graveyard... Read the Full Story
  If all you do is match what your competition offers, you give your customer only one criterion on which to base their decision to buy from you – price. And that is a step into the commodity trap, a slow and painful death of lowering prices to get business.      Enter the Monopoly Control concept.  This is all about competitive advantage.  As Michael Porter, a leading strategy thought... Read the Full Story
It’s the holy grail of business – generating revenue without having to ‘resell’ the product or service.     Recurring monthly revenue provides cash flow, overhead coverage, value acceleration and peace of mind. This is a driver of business value that can provide a considerable advantage to growth, yet many businesses fail to capitalize on it.    Remember, when a buyer – whether a family... Read the Full Story
Posted by Tom Garrity on September 12, 2018
compass-point-consulting-family-business-value
In my 30+ years in business, this concept has escaped most business owners who want to transition ownership/sell – the relationship of cash flow and business value, known as the Valuation Teeter Totter.  We call it that because it reflects the relationship between cash, or the company's ability to generate cash, and the value of the business.   If you recall as a kid sitting on a teeter-totter,... Read the Full Story
Posted by Tom Garrity on August 22, 2018
One of the breakthroughs in Scaling Up your business is finding your ‘great customer’ – big orders, easy to work with, repeat.  Then all of sudden you realize they are 50% of your business, and a new problem arises – if you lose them, it will have a major impact on the business.  The relationship also begins to change, as the customer begins to have more power to press their agenda. In the... Read the Full Story
Posted by Tom Garrity on August 8, 2018
As business owners, we take great pride in our past, our business’ accomplishments and our own – association awards, anniversaries, and employee/customer success stories.     But the reality is buyers don’t buy the past. Whether they are family or a third party, the #1 thing a buyer is buying is the future stream of profits.  For the owner it is an end, but for the buyer it is a beginning.   In... Read the Full Story
Posted by Tom Garrity on July 25, 2018
Financial Performance - Is there value in your financials?
Most business owners want to create wealth, exit on their terms, and empower the next generation to continue the legacy of their blood, sweat, and tears. There is only one way to make this happen – maximize the value of your business, NOW.     Because if you wait, you will run out of runway and won’t maximize your business value. It happens all the time.  The first value driver to focus on in the... Read the Full Story
Posted by Tom Garrity on July 11, 2018
Most business owners want to create wealth, exit on their terms, and empower the next generation to continue the legacy of their blood, sweat, and tears. There is only one way to make this happen – maximize the value of your business, NOW.  Because if you wait, you will run out of runway. It happens all too often.  How do you maximize value?  Focus on the eight drivers of value as outlined in the... Read the Full Story
Posted by Tom Garrity on June 26, 2018
It used to be that wealth was created from physical assets: land, natural resources, and human and machine labor. But the world has changed.    As Chris Snider explains in his book, Walking to Destiny, “Technology has disrupted the entire system.  Today, wealth is created by your ability to create, transfer, assemble, integrate, protect, and exploit knowledge assets.  These are the organization’s... Read the Full Story
Posted by Tom Garrity on June 13, 2018
4Cs of Capital - Your ideal customer
For many business owners, business value is something they HOPE happens along the way. But just like driving growth, profit and cash, you can and should plan to grow value as well.  This is what the owner’s game is all about – building a business that can be converted to cash someday to support the lifestyle you desire.   Business value is determined through three primary methods – discounted... Read the Full Story
Posted by Tom Garrity on May 23, 2018

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