Be an Ethical Entrepreneur, Marketer, and Business Builder

Want to dramatically increase the value of your business in 4 weeks?

June 12, 2011 by Leave a Comment

Go on a 4-week vacation!

Seriously… Until you, the owner, can take a 4-week vacation, your business is still too dependent on you and therefore is potentially worth 1-2 multiples of your cashflow LESS than if you take that vacation!

As a business broker and business coach I have a very unique perspective on small business ownership… I get to see businesses that are just getting started, decades old and will be run by the same owner for a few more decades, and businesses in the process of being sold to a new owner. No matter where your business is, it is never too early to have a plan to make your business NOT dependent on you, the owner. (Can you see where I’m going with the mandatory vacations, yet?)

There are 3 main reasons for this:

  1. You’ll be more satisfied because you’ll have to work less.
  2. Your team will be more effective since they’ll have ownership of their jobs.
  3. Your business will be worth more when it is time to sell.

Unfortunately most small businesses are heavily dependent on the owner. The owner is needed to sell, service, or deliver the products or services of the business OR the customers and team expect the owner to make important decisions and solve problems. If this sounds like you, let me hit you right between the eyes; you have a BIG problem that you need to start changing right away. If you wait until you’re ready to sell or retire to start transitioning yourself out of your business, then your selling price will be lower. Trust me, I know this from direct experience selling small businesses.

Now that you’re ready to start engineering a business that runs without you, here are the first 3 steps.

  1. Stop using the term “owner” – Throw away every business card that says this. Train yourself to never respond as “owner” when someone asks. If your sales pitch includes, “and you get to deal directly with the owner if there’s a problem,” immediately stop saying that. Give yourself a new title like Team Leader, General Manager, President, or CEO and NEVER use the term owner again.
  2. Empower your employees to take ownership – If your employees know you’re the one to solve all problems, you need to start changing that immediately. Empower them to make decisions. Some decisions will be good and some will not. In the long run you’ll have less on your plate, your team will feel more involved, and your business will be more sellable. Utilize procedures, scripts, and checklists to help your team members feel more confident with their power and to make sure everyone colors inside the lines.
  3. Train your customers to not rely on you – Believe it or not, your customers will do whatever you train them to do. If your customers are trained to call and ask directly for you (or the owner), you need to stop that right away. No one should ever need to talk to the owner because the Team Leader (or whatever title you choose) or someone else on the team should be able to take care of any problem. Ultimately you’ll replace yourself with a different Team Leader to completely transition yourself out of the business. At that point your customers will be trained to ask for the Team Leader, not the owner or you personally. In the mean time, train your employees to ask everyone, “What did you need help with today?” before transferring a call to you. If necessary, have your staff tell the customer, “Bryan will be tied up all afternoon. Give me a minute to direct you to someone else who can help.” If he still insists, when you do call him back, apologize for the delay and let him know the name of the person on your staff who can help him more quickly next time and that she will be expecting his call. For a big account, have your employee call the customer and introduce herself.

In my experience, the BEST way to accomplish #2 and #3 above is to take regular vacations. It forces your team to get used to solving problems on their own. More importantly, it forces you to NOT solve every problem. We entrepreneurs always want things done “our way” however if you want to build a sellable business, it will be worth more if it can run without you.

One last suggestion. After you return from each vacation, make notes on exactly what was waiting for you when you returned. Then humanize or systematize every item on the list so someone else can take care of that task the next time you leave.

To your vacationing success, Bryan

P.S. If you’re not the owner of a business but are instead the current GM or Team Leader this blog applies to you, too. Use this information to start transitioning “lower level” work away from you to other people on your staff. This will allow you to focus more on growing the business.

P.P.S. If you’re considering selling your business in the next 5 years, sign-up for my email course to learn exactly what you need to do to prepare your business to maximize your sale price.

Filed Under: Business Buying/Selling Tagged With: ,

How to prepare your business for running without you…

January 2, 2009 by 5 Comments

As a business builder, the goal of every business you buy should be one of 2 things:

  1. Resell it quickly (within 12 months) for a substantial profit.
  2. Keep it as a great cash producer with minimal work on your part.

This blog is going to focus on one of the most important parts of achieving step 2 above – getting your office used to running without you! For this to happen, you MUST set a goal of being out of the office for at least a few days (preferrably a week) per quarter. If you’ve never done that before, choose a week in the next 3 months and write it on the calendar right now! Seriously, if you don’t make the commitment to be out of the office right now you may never do it. Don’t worry. You will not be 100% prepared for the office to run by itself the first time. Or the second time. Or maybe even the third time. However, each time you’ll learn what your team relies on you for. As you learn more and more what items they just HAVE to call you to take care of, you will immediately know which items you need to create procedures for to replace you. If procedures won’t cut it, you need to pay someone else to make those decisions for you.

Now let’s look at what’s necessary for you to leave the office while your business keeps making money. Firstly and most importantly, you cannot be the one responsible for direct customer interaction. Whether that means taking care of customer service issues or selling your product, if you’re the only one capable of that, then you have a problem. You need to learn how to replace yourself right away. OK, so you’re not looking to retire so what are you allowed to do? Anything that doesn’t require you to actually be in the office. In other words, all of the tasks that can be done or maintained remotely.

A few of those items that I work on regularly when I’m out of the office are the following:

  1. Paying bills – I do this with Quickbooks Pro and Wells Fargo Online Bill-Pay. I can pay my bills electronically from anywhere. My office administrators put all the bills into Quickbooks and scan all of the bills onto my server so I can actually look at every Purchase Order, Order Confirmation, Packing Slip, and finally the Invoice before I pay anything.
  2. Working on marketing – whether it’s updating the website or working on new direct mail campaigns all I need is internet access and my laptop to work on almost any marketing our company might be doing.
  3. Reading and responding to emails – This can always slow down your “productivity” when you’re in the office so a few quick minutes in an airport or in the morning before you hit the beach can help you remain “productive” all day as people are reading and responding to all of the emails you’ve sent out.
  4. Keeping an eye on daily, weekly, or monthly tasks – Since I’m the Team Leader at my business there is no one else to take over management functions while I’m not there. For that reason, all of the girls who work in my office email me their “To-Do” list every evening before they leave. That way I can review and update it at my leisure. I also review our service schedule, inventory, receivables, payables, customer complaints, new leads, and a host of other things remotely. One girl in my office compiles the reports weekly and emails it to me so all I do is read them and make decisions – No matter where I might be sitting when I read those reports. Check out the “Know your numbers” section of my blog on weathering the economy for a better idea of what numbers I watch.
  5. Staying in touch with team members – Whether that means calling, emailing, or reviewing performance there’s a whole lot you can do to make sure everything is “business-as-usual” when you’re not around.
  6. Finding new business opportunities – If you aren’t ready to retire with all the money you have in the bank, you should always be researching new opportunities. As a matter of fact, the number one reason you need your cashflow business to run without you is so you have time to invest buying, building, and selling other businesses.

How to make sure your business is “running without you”.

  1. Leave the office – But don’t just stay at home. If you’re in close proximity to the office both you and your team member’s will be too reliant upon you.
  2. Try not to answer your phone – Let it go to voicemail, listen to the voicemail and respond appropriately. If possible, respond via email or text.
  3. Make yourself available via email (IM if necessary) – I prefer written communication because it’s short and to the point (no time for small talk) and because it’s all tracked. Someone can’t tell you you never told them to do X or Y.
  4. Have access to important information on your server – Whether that means having your invoices, inventory, schedule, or incoming leads on the computer. Whatever is important to you, you need to make sure you have access to at all times. If you can’t get to your important information from anywhere at anytime you’ll never be able to work remotely.

Have you ever had one of those days where you have a list of things to accomplish and at the end of the day the list hasn’t gotten any shorter? You just worked on “little things” all day. It’s amazing to me how many of those “little things” take care of themselves when I’m not around… In my experience if I leave the office for 2 days or 2 weeks, if I’m keeping up on things day-to-day while I’m gone, my list of “catch-up” work when I return is the same length. The list is limited to the items only I can handle. There are no “little things” on my list to catch up on… Every time my list consists simply of the things only I can do. (With the goal being to shrink that list with every trip.)

Since I track customer complaints AND testimonials if there were problems created by me not taking care of those “little things” I’d know about it, too. 😉

So make a commitment to be out of the office!

To your “remote management” success, Bryan

P.S. When you go to sell your business do you think it’s going to be worth more or less when you show the buyer that it can be managed, to a large degree, while sipping red wine on the balcony of your hotel in Italy?

Filed Under: General Business, Leadership, Team Building Tagged With: , , , , ,