Call it the “Uberization” of the workforce, but change in this day and age is inevitable "“ and it's up to you to properly prepare. This is precisely why I wanted to write this series!
If you know my story, you'll know I built The Cadman Capital Group from nothing to a group of 32 cohesive and complimentary companies. However, this wasn't without plenty of restructuring, hiring and firing, and the tweaking of multiple business models.
This is why the valuation of your business is so important: it's impossible to stay competitive in times of change unless you know your value. Things change exceptionally fast in the realm of new technology, business, and ideas. Here are are a few ways to find the value of your company – helping you to stay agile and competitive.
Know your Business Down to the Penny
It's impossible to thrive if you aren't sure what the numbers are. If the "books" aren't your thing "“ you need to hire out and find out exactly where you're making money and where you're losing it.
Also, make sure you have a plan in place to still run with the bare minimum staff as a worst-case scenario. It's important that you have an “if all else fails” plan.
A lot of business owners make the mistake of banking on projections and passion rather than solid numbers. Sure, you've put a lot into your business and know that in the coming year, you’ll experience growth. However, it won’t benefit you to factor this into your valuation. Doing so will only inflate the numbers and if you need to restructure, you won't know where to start.
Check out the Competition
Maybe a business owner you know is looking to sell "“ it doesn’t hurt to do a bit of digging. Look at other companies similar to you in industry and in area. It's oftentimes difficult to know where they got their numbers from, but at least this can provide some insight into the health of your business in comparison.
Hire a Valuator
If you're not sure and need some help valuating your business, there are professionals that can get the job done. While expensive, usually costing a few thousand dollars, it's sometimes good to have an outsider's perspective on the subject. Most business owners will over-valuate their worth and it's good to have a professional come in to double-check the numbers.
Once you've determined the worth of your business, you'll have your starting point. The next step to thrive in times of change and uncertainty is finding out how to stay competitive in today’s market - which I’ll cover next week!
Giles Cadman is Chairman of The Cadman Capital Group, a group of cohesive, complementary companies, operating in the international trade, retail, leisure, and investment markets. Learn more about Giles.