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If you’re in the service business, the value of the business is in your hands. (Or brains). But how do you monetize your specific service and skill set? How you can turn your services into assets so your business is more attractive to buyers down the line?
On this episode, business lawyer and best-selling author Cliff Ennico, Esq. shares what it’s like to be looking at it from the buyer’s side, so you can reverse-engineer the steps to a successful exit!
Inside Secrets from the Buyer’s Side…
- A buyer wants a turnkey operation. Yet, up to 60% of customers may leave when a service business changes hands. That’s scary for buyers. Helping your customers “groove” with the new buyers goes a long way to minimize attrition rate.
- Plan to stick around … for a little while. Buyers get nervous when an owner wants to jump ship within 30 days. Consider a transition period of 6 to 24 months to help your buyers understand the business.
- Know your assets. In a service business, these include your brand and goodwill, your client lists, and your engagement in the community. Does your business depend on local traffic? Or work remotely? Your answer will influence what kind of buyer is the best fit.
- Employees are key to the deal … if they’re loyal. They ensure the business keeps functioning, but not if they walk out the door with your top clients right after the transition. Consider non-solicitation terms in your agreements.
In short, what do buyers want? They want to know that your company’s revenue stream will continue to flow after you’re gone. Tune into this episode of Cash Out BIG for more of Cliff Ennico’s tips on how to do just that!
Since 1996, Cliff Ennico, Esq. has worked as a “general counsel” or “Wall Street lawyer” to hundreds of small businesses, entrepreneurs, franchise owners, self-employed professionals, not-for-profit entities, and other business clients throughout the northeastern United States. The former host of a PBS television series for entrepreneurs, he has helped launch over 20,000 new businesses in his 35-year career. In addition to The Crowdfunding Handbook, he is the author of seven best-selling legal treatises for ThomsonWest, three legal career guides for Kaplan Publishing, and three legal guides for online retailers including The Small Business Survival Guide and The EBay Seller’s Tax and Legal Answer Book. He’s a leading authority on entrepreneurship and small business management.
“Never let a lack of knowledge, experience, or talent get in the way of your success … because Lord knows, it never stopped me.” ~ Cliff Ennico
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