Tag Archives: financial goals

selling your business

6 Steps To Selling Your Business

Don’t ignore one of the most vital elements of your business plan, the exit strategy. Here are key business practices for selling your business.


If you’re a typical small business owner, you spend more of your time working on today’s issues than tomorrow’s potential. That may keep the doors open for now, but what about when you’re ready to retire, or no longer have the will or energy to run your business?

As mid to large businesses grow, owners typically realize they’ll need to find a way out, but most small business owners do not have an exit strategy. Rather than simply selling inventory and closing the doors, the suggestion is that small business owners can increase their wealth by capitalizing on the goodwill or customer base they’ve built up.

Here are some basic business practices that many entrepreneurs overlook, but can help keep the company buffed up and ready for the marketplace.

Key business practices for selling your business:

1. Write down the business processes

You can’t sell a business that is in your head. So, you need to write it down. Entrepreneurs don’t typically like dealing with details and the fine points, but you must document how everything works in your organization.

For example, spell out the roles of management and employees, not titles, but their actual responsibilities. Or, describe a typical customer visit. Franchise companies list these types of details; a small business owner can use the same tactics to show the value of their company to a potential buyer.

2. Set financial goals

You cannot sell a business that is not making money. And, how do you know if you’re growing if you don’t know where you started and where you’re going? Once you’ve set some target goals, measure them on a regular basis. Look at the internal processes of your business and make sure they are still working for your customers and your company alike. You may be pleasing customers, but are you making money? Know what your return on investment is, so you can explain it to those interested in buying your company.

3. Have a marketing budget and plan

Many small business owners don’t allocate money for marketing. A marketing plan, with a corresponding budget, is key to attracting and keeping customers. One rule of thumb is to spend the equivalent of one staff salary on your marketing and advertising. Think of it as your “silent” employee working 24/7. Market awareness of your brand and demonstrated customer loyalty can dramatically increase the value to potential purchasers. Marketing is the last thing you cut even if times are bad.

4. Keep track of customer information

Often, the most valuable aspect of a business to a potential buyer is your customer list, especially if your potential buyer is a competitor. Keeping track of customer contact information, including name, address, phone number and email (along with permission to contact them electronically), is a must. Being able to deliver customer profiles and buying habits to a new owner demonstrates how well your business is run and makes your customer list invaluable. If business owners don’t have customer data, they’ll be in trouble.

5. Keep employees in the loop

Your staff represents your company to customers and buyers alike. Make sure they know your goals. Communicate with your employees and ask for ideas. They can help you dress the business up for sale. If you’ve decided to sell because the business is in trouble, let them know. It is unlikely to be a surprise and few things demoralize a staff more than having to rely on water cooler rumors. Try to avoid staff salary cuts if possible. Your people are the face of your business and a salary cut may backfire. Try looking at your business processes and finding ways to save money instead.

6. Get professional advice

Identify the areas of your operation that need improvement and look for specialized help to simplify your processes. Make sure to test them before the potential buyer does. There are consulting professionals on a part-time basis who have knowledge implementing transition strategies for businesses and can help you, for a reduced fee.

So, don’t ignore one of the most vital elements of your business plan, the exit strategy. With careful planning and monitoring from day one, your last days of business can bring rich rewards.

For more information about selling your business and/or B2B CFO, visit b2bcfo.com.

Financial Statements

Using Financial Statements, Tools To Plan Your Future

Know what you have before planning the future using specific financial tools and financial statements.


There are many famous quotes about the importance of enjoying the present and not focusing too much on the past or the future. We do this in our personal lives and with many of our responsibilities, such as work, education and our finances. As a financial planner, I meet with many people seeking assistance with meeting specific financial goals and find that many times they have ideas of what they want and what they have already done. This is great, but before planning the future, it is important to know what you have now, a snapshot of your current situation. This is a critical piece, not only for individuals, but businesses, too.

Before focusing on investment news, what stocks are hot, politics and what might be a new trend in the investment world, investors should focus on understanding their current position. It is nearly impossible to determine the right mix of investments and what strategies may be appropriate without knowing this. Investors can use specific financial tools, including different financial statements, to help them identify what they have. These tools can apply to both individuals and businesses.

The first step is a data-gathering process. The second is imputing the information from various financial statements. For individuals, we would include a statement of financial position and a statement of cash flow. For business owners, we would include a balance sheet, income statement, statement of cash flow, and a pro forma statement. These are great tools that can help identify one’s financial position.

When creating a statement of financial position, one will clearly list his or hers assets and liabilities. Assets, such as real estate or other valuable items, should be considered at current market value (the price that one is willing to pay today for it). Assets should be categorized as cash and cash-equivalents, such as checking, savings, money market accounts, stocks, bonds, mutual funds and life insurance. Liabilities include credit cards, auto loans, unsecured loans, real estate mortgages, education loans and personal debts. This will provide individuals a balance sheet of assets at a particular point in time.

The next important piece is a statement of cash flow. Some of us may know this as an income statement. This statement will show inflow of income and outflow of income at a particular point in time. The inflow may include salaries, sale of assets, investment dividends, rent and bonuses. Outflows may include mortgage payments, auto payments, credit card payments, insurance, general living expenses and taxes. The statement of financial position and statement of cash flow are valuable tools to have before implementing an investment plan.

A pro forma statement is the last tool to use and includes future projections of the balance sheet and cash flow statement. This is important because as our economy and life situations change, we may need to adjustment our plan as needed. The same process also applies to business owners. However, the business entity will need to consider many more details regarding assets and liabilities, as well as inventory and staff.

Once the financial statement process has been completed, one will have a greater understanding of his or her position when beginning an investment plan. In addition, this process can improve the odds of success and allow more control in an investor’s decisions.

For more information about financial statements and financial planning, visit jacobgold.com.

Securities and investment advisory services offered through ING Financial Partners, Inc. Member SIPC. Jacob Gold & Associates, Inc. is not a subsidiary of nor controlled by ING Financial Partners, Inc.

This information was prepared by Michael Cochell of Jacob Gold & Associates Inc. and is for educational information only. The opinions/views expressed within are that of Michael Cochell of Jacob Gold & Associates Inc. and do not necessarily reflect those of ING Financial Partners or its representatives. In addition, they are not intended to provide specific advice or recommendations for any individual. Neither ING Financial Partners nor its representatives provide tax or legal advice. You should consult with your financial professional, attorney, accountant or tax advisor regarding your individual situation prior to making any investment decisions.

Reaching Requirement Goals

Reaching Your Retirement Goal Requires Commitment

When it comes to investing, retirement planning, or tracking our markets, we rely on the media to get our information. It may be from the newspaper, television, magazines, the Internet, or our cell phones. Either way, we learn a lot about what to do and what not to do about investing from the media. We must remember that the information can work for us or against us depending on how we apply it. Now, how does this relate to reaching our financial goals? Knowing some of the key elements that help reach financial goals is critical. The value of time, the commitment to save, and understanding what you invest in are a few of these critical elements.

Understanding these elements will help the everyday person read through some of the information from the media and apply it to their situation. For example, many investors may spend countless hours researching a product or investment but not consider the value of time in an investment. The future value of an investment, compounding at a given return, is powerful, but factoring in the concept of time can make a huge difference in one’s nest egg. In other words, if one were to start investing the same dollar amount every year at the age of 21 rather than 35, the value of that investment may differ by the hundreds. Most of the media information we see does not account for the value of time for investing — only the investment and what trend is in place NOW!

Saving for the future is dependent on so many factors. Many of us forget that understanding our behaviors is important as it applies to our finances. The commitment of saving is the first step and is usually the hardest. For some of us, taking the actions to execute a commitment is challenging and requires others to help. A great example of this is when employers automatically sign up their employees to participate in their retirement plan. Studies have shown that when the employers take this approach they had much higher participation even when employees were given the options to opt-out. (Source: “Behavioral Economics” by Sendhil Mullainathan, MIT & NBER and Richard Thaler, University of Chicago and NBER).  Planning and committing to saving can be a complex decision, many of us avoid making this decision and committing to it.

Once we have committed to saving, we must consider our investment strategies. It varies among several factors. These factors are risk tolerance, time horizon, and financial needs for retirement. For this reason, I highly suggest using a financial professional to provide recommendations for investments that are appropriate. In addition, it is imperative to consistently review your accounts and objectives. Although we may have a plan in place, our world, economy and financial situations change, so we must be educated and prepared to make adjustments when needed.