How to Get Rich in 3 (Really Difficult) Steps

Becoming wealthy may not be your primary goal, but if it is, there is a reasonably predictable way to get rich in America.

Step 1: Ignore Your Parents

Parents around the world typically encourage their kids to get educated so they can get a ‘good job.’ This may mean becoming a doctor or lawyer, although neither tends to be a path to significant wealth. High-paying professions provide an excellent income stream, but two insidious forces undermine the professional's ability to create significant wealth: tax and spending.

Tax

It is difficult to become wealthy on the basis of a salary alone. Since income is taxed at the highest possible rate, you're left with not much more than 50 cents on the dollar.

Spending

The other problem with having a high income is that it creates a ‘wealth effect’ that triggers spending. Thomas J. Stanley, the famous author of the research-driven classic The Millionaire Next Door, points out that some professionals—in particular, lawyers—spend a large portion of their income to give the impression that they are successful, in part because they do not enjoy much social status from their job. In other words, when you earn $500,000 a year, you buy a Range Rover or send your kids to an elite private school at least in part because you want people to think you are wealthy.

Step 2: Start Something

Most wealth in America is created through owning a business. Recently, Mass Mutual looked at the proportion of business owners that make up a number of wealth cohorts. They found that 17 percent of people with between $100,000 and $500,000 to invest were business owners.

Keep in mind that there are about 8 million employer-based companies in the United States, meaning that the incidence rate of business ownership (the natural rate at which you find business owners in the general population) is about three percent. Said another way, if you grabbed 100 people walking down the street, on average three of them would be business owners. On the other hand, if you took a random sample of 100 people with investable assets of between $100,000 and $500,000, 17 of them would be business owners, meaning you're over five times more likely to find a business owner in the $100,000 to $500,000 wealth segment than you are to find an employee in the same segment.

The trend becomes more pronounced the higher up the wealth ladder you go. If you look at wealthy investors with between $500,000 and $1,000,000 in investable assets, you'll see that the proportion of business owners in this segment goes up dramatically—to27 percent.

The Very Rich

Among investors with between $1 million and $10 million in investable assets, the proportion of business owners jumps to 52 percent. As for those investors with $10 million to $50 million sloshing around in their bank account, 67 percent are business owners; and for investors with $50 million dollars or more in investable assets, 86 percent are business owners.

Simply put, if you meet someone who is very rich, it's highly likely they are (or were) a business owner.

Step 3: Get Liquid

The next step for you as a business owner is to focus on improving the value of your business so that you can sell it for a premium. Just being a successful entrepreneur is typically not enough to become rich. You have to find a way to take the equity you have locked up in your business and turn it into liquid assets. When it comes to selling your business, the three most common options are:

·         Acquisition: This is the headline-popping way some entrepreneurs choose to trade their shares for cash. When Facebook acquired WhatsApp for $19 billion, founders Brian Action and Jan Koum got very rich.

·         Re-capitalization: A minority or majority "re-cap" occurs when you sell a stake in your company (often to a private equity firm) yet continue to run your business as both a manager and part owner, with a chunk of your wealth in liquid assets outside of your business.

·         Management Buyout: In an MBO, you invite your management team (or a family member) to buy you out over time, usually with a mixture of some cash from the profits of your business as well as debt that the managers take on. There are other, less common ways to turn your equity into cash (e.g., an IPO), but the key is turning the illiquid wealth in your business into diversified liquid wealth. The best part about selling a business is that the wealth created is taxed at a very low rate compared to employment income, so you get to keep most of what you make.

You might argue it is better to keep all of your wealth tied up in your business as it grows, but that can be a risky proposition—just ask Lululemon's Chip Wilson or BlackBerry's cofounder Mike Lazaridis. If you keep your money locked up in your business, it also means you may not be able to enjoy the benefits of wealth. You can't use illiquid stock in a private company to buy an around-the-world plane ticket or a ski chalet in Aspen. You actually have to get liquid first.

There are many good reasons to build a business; and for you, wealth creation may not be as important as making an amazing product or leading a great team. But if money is what you're after, there is no better way to get rich than to start and sell a successful business.

In creating a more valuable business, it is always the little things that get the big results. Our Business Health Check will give you invaluable insights into the many areas of your business that if tweaked will increase the value of your business.  By completing the Business Health Check, you will receive a Free Report based on your answers, prepared by our team of highly skilled Business Coaches.  CLICK HERE to take your Business Health Check Now

Steve Goranson has owned and operated the Northeast Florida of ActionCOACH since 2014. ActionCOACH is the World's #1 Coaching franchise with of 1000 offices in 50 different countries.  They coach over 15,000 business each week.

ActionCOACH Steve Goranson's commitment is to assist small business owners, to spend less time working "in" their business and more time working "on" their business so they can build a more valuable and sellable business. In the end, you’ll be spending less total time working, will be making more money and will have truly created the company and team you always dreamed of. In addition we will help you put the FUN back in your business and your life.

Steve's clients are feeling happy because they are focused on their goals, they're feeling more successful because they are reaching their goals, and they are feeling more free because their businesses are starting to work harder than do. 

Business Advice: Creating Your Target Market is as easy as ABC

When I ask business owners who their target market is, the common answer I get is “everyone can buy my product or service”.  Most businesses use this shot gun approach to target marketing.  Target marketing is more about being laser beam focused instead of using a shot gun approach.  

When you use the shot gun approach you’re hitting areas that are not ideal and you end up with a lot of waste.  For some business that waste could be the difference of thriving, surviving or going out of business.

We forget that everybody buys from us for a different reason, so how do you expect to appeal to all of your potential customers at the same time?  The answer is simply, you can’t unless you have an unlimited marketing budget.  Our marketing must be laser focused for it to be effective and efficient. When we focus on our target market instead of just everyone, our marketing has a better opportunity to be successful.  One way to determine your target market is to first analyze your current customer base.  

I’m sure if you are like most businesses you have some awesome clients.  They buy from you most often, they are a pleasure to deal with, and never fuss over price.  Then you have your basic “bread & butter” accounts.  They buy from you most of the time but not necessarily consistently.  Next, you have the clients that are the ones that are hard to satisfy, don’t spend that much, and are always complaining about something, and just suck up all of your time.  

I call this your client ABC’s.   A = Awesome | B = Basic | C = Can’t deal with

It doesn’t take too much common sense to know that we would want more “A” accounts than “B” & “C” accounts.  Now when you think about it, our clients that we spend the most amount of time with, is our “C” accounts.  When in actuality we should be investing our time nurturing our “B” accounts to become an “A” account, and over servicing our “A” accounts so they never want to go anywhere else.  Since most of our time is being sucked up by our “C” accounts, we have never taken the time to identify what makes a Grade “A” client. 

Isn’t that interesting?  We don’t spend that much time with our ideal accounts because they are easy and we take them for granted. 

How much do they spend?  How often do they spend? Do they refer business? What are the demographics, locations, occupation, hobbies, income, & family status?  It might not be a bad idea to send them a survey and ask them why they buy from you.  This can also help you to you to identify your USP.

Knowing who your target customers are will allow you to aim at the right places to reach them. Often you can have more than one target market or kind of customer.  If this is the case, it’s far better to segment them and target them with different messages. Start with one target and drill deep, then move on to a second later.

Is your company’s marketing awesome or lame? Take our quick marketing test to see how effective your current marketing efforts are.  CLICK HERE to take the FREE marketing test

4 Traps To Avoid When Selling Your Company

Business owners have been known to refer to due diligence as "the entrepreneur's proctology exam."

It's a crude analogy but a good representation of what it feels like when a stranger pokes, prods, and looks inside every inch of your business.

Most professional acquirers will have a checklist of questions they need answered if they’re considering buying your company. They'll want answers to questions like:

• When does your lease expire and what are the terms?
• Do you have consistent, signed, up-to-date contracts with your customers and employees?
• Are your ideas, products and processes protected by patent or trademark?
• What kind of technology do you use, and are your software licenses up to date?
• What are the loan covenants on your credit agreements?
•  How are your receivables? Do you have any late payers or deadbeat customers?
•  Does your business require a license to operate, and if so, is your paperwork in order?
• Do you have any litigation pending?

In addition to these objective questions, they'll also try to get a subjective sense of your business. In particular, they will try to determine just how integral you are personally to the success of your business. 

Subjectively assessing how dependent the business is on you requires the buyer to do some investigative work. It's more art than science and often requires a potential buyer to use a number of tricks of the trade, such as: 

Trick #1: Juggling calendars

By asking to make a last-minute change to your meeting time, an acquirer gets clues as to how involved you are personally in serving customers.

If you can't accommodate the change request, the acquirer may probe to find out why and try to determine what part of the business is so dependent on you that you have to be there.

Trick #2: Checking to see if your business is vision impaired

An acquirer may ask you to explain your vision for the business, which is a question you should be well prepared to answer. However, he or she may ask the same question of your employees and key managers. If your staff members offer inconsistent answers, the acquirer may take it as a sign that the future of the business is in your head.

Trick #3: Asking your customers why they do business with you

A potential acquirer may ask to talk to some of your customers. He or she will expect you to select your most passionate and loyal customers and, therefore, will expect to hear good things. However, the customers may be asked a question like 'Why do you do business with these guys?' The acquirer is trying to figure out where your customers' loyalties lie. If your customers answer by describing the benefits of your product, service or company in general, that's good. If they respond by explaining how much they like you personally, that's bad.

Trick #4: Mystery shopping

Acquirers often conduct their first bit of research behind your back before you even know they are interested in buying your business. They may pose as a customer, visit your website, or come into your company to understand what it feels like to be one of your customers.

Make sure the experience your company offers a stranger is tight and consistent, and try to avoid personally being involved in finding or serving brand-new customers. If any potential acquirers see you personally as the key to wooing new customers, they'll be concerned business will dry up when you leave.

In creating a more valuable business, it is always the little things that get the big results. Our Business Health Check will give you invaluable insights into the many areas of your business that if tweaked will increase the value of your business.

By completing the Business Health Check, you will receive a Free Report based on your answers, prepared by our team of highly skilled Business Coaches.  CLICK HERE to take your Business Health Check Now

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Business Advice: Be an agent of change

A man walks into a psychiatrist’s office.  “Doc, every time I see nickels, dimes, and quarters, I have a panic attack!  What can the problem be?

“Oh that’s easy” the doctor answers. “You’re just afraid of change”.

How many of us go through life virtually paralyzed because we are afraid of change, to try something new or different.

This fear keeps us from expanding our growth, knowledge, and success and limits our lot in life.

To break out of this cycle of fear we need to understand what fear really is.

Here’s two explanations of what fear really stands for;

False

Expectations

Appearing

Real

So how do we change or how can we be a change agent for others?

If someone is satisfied with their lives, will they change?  No, because they are satisfied.

If someone is unfit, overweight, or unhealthy, but they are satisfied with that, they are still unlikely to change.

Many of us have the ability to change the instant we become unhappy with our lives.

Others of us have to wait for a stroke or another disaster before we realize the need to change.

We see that there are two ends of the scale.  Some wait until the end and some change right at the beginning and some change just for the sake of change. Somewhere in there, there is a happy medium for you.

There is a simple formula that will allow us to understand the process of change and what we can do to affect positive changes in ourselves and in others.

(D x V) +FS > R

The “R” stands for resistance.  To overcome the resistance to change, what needs to be greater?  What can tip the scale to overcome our fear of change?  Let’s take a closer look.

The “D” in the formula stands for Dissatisfaction. Before you can change you have to have a level of dissatisfaction…

What builds dissatisfaction more than anything else?  “V” for Vision.

Let’s say that you are a kid living in an impoverished neighborhood. You don’t know any better life than that.  Are you dissatisfied with your life?  Not necessarily, you may be satisfied because you don’t know any better.

Why is it that when you are in business you need to consistently improve your business education?

Why do people hire a business coach or have a mentor, to help push them thru their comfort zone and to help them grow their vision.  They need help to look at what their next level is supposed to be.

Dissatisfaction takes a belief that there is something else out there.

One of the things I do as a business coach is to help my clients feel a level of dissatisfaction or discomfort, if they don’t do the work required to change.  Without a coach or a mentor you stay in your comfort zone because people don’t like feeling dissatisfied.  Dissatisfaction comes first but then we have to have vision and a belief that the vision is possible.

Those kids living in the impoverished neighborhoods can watch television and they can see other places in the world, but most have no belief that a different life is possible for them.  However, some do get a belief that it is possible.  Some of you reading this article are where you are today, because of the vision and the belief you had of a better life.  You believed it was possible.  That is why you have worked to make a better life for yourself.

My question is, how do we raise the dissatisfaction level for where you are now and how do we raise the vision of where you want to go?  Most of us are not experiencing change.

One of the fastest ways that I have found to raise people’s dissatisfaction is by having them write a check into their own investment accounts at the first of the month.  This check is from your business into your own investment or profit account.  An investment or profit account is an account that you can’t get direct access to.  If you take out $10,000, $5,000, $1,000 or even $100 a month, you then have little or no money left to pay the bills.

Is there going to be a level of dissatisfaction going on?  Absolutely!  How much harder are you going to work to pay off your creditor that calls you every day?  You have to create a vacuum that needs to be filled.  You have to start stretching yourself and expanding out of your comfort zones.

The next step of the equation is “FS” which stands for First Steps.

We have dissatisfaction, we’ve created a vision of what we want, but we don’t know how to start.

This is where a mentor or a coach can help.

Don’t look at eating the whole elephant all at once, just take it on one bite at a time.  Lee Iaacoca, states that the discipline of writing something down is the first step toward making it happen.  Take the time to write out your plan and break it into bite size chunks and get into Action.

By doing so, you will begin to break through the barriers in your life and stretch your comfort zone to reach a level of success you’ve only dreamed of.  Use this formula not only to help facilitate change in your life but to be an agent of change in the life of others.  Help them to understand and qualify their dissatisfaction, help them to build their vision what they want to achieve, and finally give them the first steps to move toward that goal.

By following this simple formula you can truly become an agent of change in your life as well as the life of others.

In business, it is always the little things that get the big results. Our Business Health Check will give you invaluable insights into the many areas of your business. By completing our Business Health Check, you will receive a Free Report based on your answers, prepared by our team of highly skilled Business Coaches.

CLICK HERE to take your Business Health Check

Business Advice: 6 Reasons Not To Diversify

Diversification is a sound financial planning strategy, but does it work for company building?

How does Vitamix get away with charging $700 for a blender when reputable companies like Cuisinart and Breville make blenders for less than half the price?  It’s because Vitamix does just one thing, and they do it better than anyone else.  

WhatsApp was just a messaging platform before Facebook acquired them for $19 billion US. Go Pro makes the best helmet mounted video cameras in the world. These companies stand out because they poured all of their limited resources into one big bet.

The typical business school of thought is to diversify and cross sell your way to a “safe” business with a balanced portfolio of products – so when one product category tanks, another line of your business will hopefully boom.  But the problem with selling too many things – especially for a young company – is that you water down everything you do to the point of mediocrity. 

Here are 6 reasons to stop being a jack-of-all-trades and start specializing in doing one thing better than anyone else:

1. It will increase the value of your business  -- When you sell one thing, you can differentiate yourself by pouring all of your marketing dollars into setting your one product apart, which will boost your company’s value. How do we know? After analyzing more than 13,000 businesses using The Sellability Score, we found companies that have a monopoly on what they sell get acquisition offers that are 42 percent higher than the average business
2. You can create a brand  -- Big multinationals can dump millions into each of their brands, which enable them to sell more than one thing. Kellogg can own the Corn Flakes brand and also peddle Pringles because they have enough cash to support both brands independently, but with every new product comes a dilution of your marketing dollars. It’s hard enough for a start-up to build one household name and virtually impossible to create two without gobs of equity-diluting outside money.
3. You’ll be findable on Google  --  When you Google “helmet camera,” Go Pro is featured in just about every listing, despite the fact that there are hundreds of video camera manufacturers. It’s easy for Go Pro to optimize their website for the keywords that matter when they are focused on selling only one product.
4. Nobody cheered for Goliath  --  Small companies with the courage to make a single bet get a bump in popularity because we’re naturally inclined to want the underdog – willing to bet it all – to win. When Google launched its simple search engine with its endearing two search choices “I’m feeling lucky” vs. “Google search,” we all kicked Yahoo to the curb. Now that Google is all grown up and offering all sorts of stuff, we respect them as a company but do we love them quite as much?
5. Every staff member will be able to deliver  --  When you do one thing, you can train your staff to execute, unlike when you offer dozens or hundreds of products and services that go well beyond the competence level of your junior staff. Having employees who can deliver means you can let them get on with their work, freeing up your time to think more about the big picture.
6. It will make you irresistible to an acquirer  --  The more you specialize in a single product, the more you will be attractive to an acquirer when the time comes to sell your business. Acquirers buy things they cannot easily replicate themselves. Go Pro (NASDAQ: GPRO) is rumored to be a takeover target for a consumer electronics manufacturer or a content company that wants a beachhead in the action sports video market. Most consumer electronics companies could manufacturer their own helmet mounted cameras, but Go Pro is so far out in front of their competitors – they are the #1 brand channel on You Tube – that it would be easier to just buy the company rather than trying to claw market share away from a leader with such a dominant head start.

Diversification is a great approach for your stock portfolio, but when it comes to your business, it may be a sure-fire road to mediocrity.

A Blood Pressure Test for Your Business

Taking your blood pressure is one of the first things most doctors do before treating you for just about anything. 

How much pressure your blood is under as it courses through your veins is a reliable indicator of your overall health; and it can be an early indicator of everything from heart disease to bad circulation.

Does it tell the doctor everything they need to know about your health? Of course not, but one powerful little ratio can give the doctor a pretty good sense of your overall well being.

A tool I use to help businesses take the blood pressure of their business is the Sellability Score.  

Your Sellability Score can be a handy indicator of your company’s well being. Like your blood pressure reading, your company’s Sellability Score is an amalgam of a number of different factors and can help a professional quickly diagnose your company’s overall health.

Predicting Good Outcomes Too

When a doctor takes your blood pressure, they not only rule out possible nasty ailments; they can also use the pressure reading to forecast a healthy life ahead. Similarly, your Sellability Score can predict good things for the future. 

For example, based on more than 10,000 business owners who have completed their Sellability Score questionnaire, we know the average multiple of pre-tax profit they are offered for their business when it is time to sell is 3.7. By contrast, those companies that have achieved a Sellability Score of 80+ are getting offers of 6.6 times pre-tax profit.

In other words, if you have an average-performing business turning out $500,000 in pre-tax profit, it is likely worth around $1,850,000 ($500,000 x 3.7). If the same company improved its Sellability Score to 80+ while maintaining its profitability of $500,000, it would be worth closer to $3,300,000 ($500,000 x 6.6).

Are you guaranteed to fetch 6.6 times pre-tax profit if you improve your Sellability Score to 80? Of course not. But just like blood pressure, one little number can tell you and your advisor a whole lot about how well you are doing; and your advisor can then prescribe an action plan to start maximizing your company’s health – and its value down the road.

Heart disease is called “The Silent Killer” because most people have no idea what their blood pressure is. People can walk around for years with dangerously high blood pressure because they haven’t bothered to get it tested. 

The first step on the road to health is to get tested. If you have a great score, you can sleep well at night knowing you have one less thing to worry about. If your score is not where it should be, then at least knowing your performance can get you started down the road to better health.

If you’re interested in getting your Sellability Score, please visit http://actioncoachsellabilityscore.com/

Business Advice: How to Network in the 21st Century

Because of today’s economy you find entrepreneurs trying to find new and innovative ways to grow and build their businesses.

A lot of people have found that going back to the basics is working.  One of the basic marketing strategies a lot of people are using today is networking.

If you look hard enough in any city (and probably not that hard), you can find an opportunity to network with other business professionals on a daily basis.

What I hate most about going to networking events is that most of the people are there trying to find their next sale, instead of attempting to build relationships.

At one of our ActionCOACH International Conferences, I was fortunate to meet and hear from 2 of the world’s best networkers; Dr. Ivan Misner founder of BNI and Michael Port founder of the Think Big Revolution and the author of Book Yourself Solid.  They each had a unique perspective on networking.

In a nutshell Dr. Misner’s formula for networking is this:  Visibility + Credibility = Profitability.

1. Visibility:  People must know you and what you do
2. Credibility: People know who you are and what you do
3. Profitability:  People are willing to refer to you

A lot of time people get out there and are visible but they forget to build credibility.  If you are always in “take” mode, then people will begin to avoid you instead of giving to you.  But once you go into “give” mode you will find that people will soon in turn want to do likewise and give back to you.

Dr. Misner also added that there are 4 basic streams of networking…

1. Casual Networks – ie., Chamber of Commerce
2. Knowledge Networks – ie, Professional Associations
3. Strong Networks – ie, BNI, Meetup Groups,
4. On-line Networks – LinkedIn, Facebook, Twitter, Google+

To be successful at networking you must participate in 3 of the 4 streams in a consistent manner.

Now Michael Port’s system is similar but with a different twist.  His approach to networking is to build a deeper relationship with your current network.  His system is about targeting people you want to get into your network and then create a plan to build a deeper relationship.   He creates a “Red Velvet Policy”.  It’s a filtration system that attracts prospects & clients that energize and inspire you and most importantly allow you to do your best work.  It’s based on values not on circumstance.

Once you determine the customer values that are most important to you, (success minded, education, strive for excellence, collaborator, commitment, & family are some of mine) you begin to identify prospects that share your values to bring them into your network and begin to build a relationship.

There are 2 basic groups you want to connect with.  The 1st is already in your network and you want to build a deeper relationship with and the 2nd group people you don’t know and want to get to know better.

Building a deeper relationship with those in your network is what Michael Port considers networking.

There are 3 daily actions you need to do to build that relationship.

1. Share your network – introduce 2 people in your network
2. Share your knowledge – share 2 articles each day that are of interest to the people you are sending them to
3. Share your passion – send a card (not an email) to someone every day.

The first step to connect to the 2nd group of people you don’t know, but want to get to know is to create a list of 20.  Each day take the person on the top of the list and send them something that is relevant to that person.  Then move them to the bottom of the list and the next day send something relevant to the next person on the list.  Once you connect to one of these people move them to your networking list to start building the relationship.  Then add a new name of someone you want to get to know.

It will take some time to get this approach started but once you get the hang of it, it should take you no more than a ½ hour a day.  Once you commit to it, you will begin to see that you will be attracting clients that energize and inspire you and most importantly allow you to do your best work.

Actions that Lead to Profits

The goal of every business is to make money or a profit.  For some reason profits seem to elude some businesses more than others.  They are working hard day in and day out, but they seem to just be spinning their wheels and not getting anywhere.  They are trapped in the American dream treadmill, moving faster and faster but going nowhere.

The reason they are working so hard and not seeing any fruits from their labor is that their actions are in the areas that do not lead to the profitability of the business.  We are busy, but we are spending our time with non-productive activities.

So what is a productive activity?  The definition is very simple.  An action that moves us toward making money is productive and an action that leads away from making money is non-productive.

In business we have to realize that “people working” and “making money” are now the same thing.  Once we understand this, we can now look at our business from a different perspective.  We now need to look at our profitability per activity.  So now we can start looking at a different set of metrics to measure how profitable a particular job or activity is in our business.

The financial measurements we now have to look at to see if we are making money are:

[1] Net Profit    [2] ROI – Return on Investment    [3] Cash Flow.

We need to determine our Profit KPI’s (key performance indicators) by determining profit per....

• Direct labor hour
• Team member
• Transaction or Job
• Customer
• Product or Service

The first area you should look at is gross profit per labor hour.  This will help you to determine what types of jobs you should focus on to increase your overall profits.  Let’s take a look at this example...

	Job A	Job B
Revenue	$3,900	$9,000
Material Costs	$2,250	$3,000
Labor Costs	$450	$2,500
Direct COGS	$2,700	$5,500
Gross Profits	$1,200	$3,500
Gross Profit Margins	30.8%	38.9%
# of Labor Hours	18	100
Gross Profit per Labor Hr.	$67.00	$35.00
Determine Labor Hr per month 10 Techs @40 hrs  (@90% compactly * 4.3 wks) 36 hrs per tech	1560/hrs	1560/hrs
Gross Profit per Month	$104,520	$54,640

In this example we are comparing 2 different types of jobs.  At first glance, Job B has a higher gross profit margin and seems to be more profitable.   However, when you further analyze the gross profit per labor hour, doing more of Job A type jobs can double the profitability of your business.

By understanding this, we can now direct our marketing to target more “A” type jobs.   Or, we can look at how we can be more efficient with Job B type jobs to reduce our labor hours per job.  Once we implement these 2 basic strategies we can begin to learn how to work smarter and not harder in our business.

How to increase the value of your business by 71%

How much did your home increase in value last year?  Depending on where you live, it may have gone up by 5 - 10% or more.

How much did your stock portfolio increase over the last 12 months? By way of a benchmark, The Dow Jones Industrial Average has increased by around 13% in the last year. Did your portfolio do as well? 

Now consider what portion of your wealth is tied to the stock or housing market, and compare that to the equity you have tied up in your business. 

If you’re like most owners, the majority of your wealth is tied up in your company. Increasing the value of your largest asset can have a much faster impact on your overall financial picture than a bump in the stock market or the value of your home.

Let us introduce you to a statistically proven way to increase the value of your company by as much as 71%.  Through an analysis of 6,955 businesses, we’ve discovered that companies that achieve a Sellability Score of 80+ out of a possible 100 receive offers to buy their business that are 71% higher than what the average company receives.

How long would it take your stock portfolio or home to go up by 71%? Years – maybe even decades. Get your Sellability Score now and you will be able to track your overall score along with your performance on the eight key drivers of Sellability. Like a pilot working his instrument panel, you can quickly zero in on which of the eight drivers is dragging down your value the most and then take corrective action.

Your overall Sellability Score is derived from your performance on the eight attributes that drive the value of your company:

1.  1.     Financial Performance: your history of producing revenue and profit combined with the professionalism of your record keeping.
2.  2.     Growth Potential: your likelihood to grow your business in the future and at what rate.
3.  3.     The Switzerland Structure: how dependent your business is on any one employee, customer or supplier.
4.  4.     The Valuation Teeter Totter: whether your business is a cash suck or a cash spigot.
5.  5.     The Hierarchy of Recurring Revenue: the proportion and quality of automatic, annuity-based revenue you collect each month.
6.  6.     The Monopoly Control: how well differentiated your business is from competitors in your industry.
7.  7.      Customer Satisfaction: the likelihood that your customers will re-purchase and also refer you.
8.  8.      Hub & Spoke: how your business would perform if you were unexpectedly unable to work for a period of three months.

To find out how you’re performing on the eight key drivers of Sellability and start your journey to increasing the value of your largest asset, get your free Sellability Score now: www.actioncoachsellabilityscore.com

Recession-Proof Your Business

Though we are not out of the woods yet, it does seem that the business climate is slowly changing due to the natural cycle of business.  It's been a rough 4-5 years for a lot of businesses.

Why some businesses thrive while others implode during an economic recession remains a puzzle to many business-owning entrepreneurs.  Not all businesses must suffer during a down business cycle.

An overwhelming majority of my clients not only survived the downturn but thrived as well.  In fact when one of my clients introduces me all the partners say if it wasn't for Steve we'd be out of business like a lot of our competitors.

What separates successful businesses from those that fail during those down cycles? 

They have planned for the future and have contingencies to confront whatever challenges arise.  They organize themselves are uniquely different and healthier approach to business.

An economic downturn can be overly challenging and devastating if you don’t put it into the proper perspective.  A business cycle very closely resembles that of the natural cycles of Spring, Summer, Fall, and Winter.  Let think of a farmer, in the spring he is planting his crop getting ready for a harvest.  In the summer, his crop is growing and begins to harvest his crop.  In the fall he is preparing for the winter that waits ahead. 

Let’s compare my analogy to the business cycle.  In the spring you need to cultivating business getting ready for the growth of summer.  In the summer you are feel great business is great but you understand that fall and winter are ahead so you need to plan.  You need to start paying down debt and save cash for when things slow down.  In the fall you need to begin to get ready for winter.  You need to start cutting the fat.  In the winter we a in survival mode but we begin planning for the spring that is just around the corner.

In the winter you need to look for opportunities to grow.  It’s a fact that during down economic times is when the true entrepreneurs begin to create their wealth.  Down economic times are times in which you can gain market share over the competition.  It’s a great time to grow through acquisition by buy up poorly managed competitors.

Currently we seem to be coming out of an economic winter, a serve one for that matter.  If you did not prepare, how can you survive and get yourself in a position to take advantage of the next business cycle? 

Jack Canfield in his book Success Principles states a simple formula for success that can help us over come this winter business cycle.  E + R = O - Event + our Response = Outcome.  We all have a goal, an expected outcome but some event always seems to come our way to make us lose focus and advert our attention.  That because our response gets refocused on reacting to the event instead of focusing on our desired out come.

ActionCOACH founder Brad Sugars, outlines 5 Steps to how to focus on looking for the opportunities available instead complaining about how bad the economy is.

Step 1 – Get you Mind Set right

If you are focusing on the negative all you will ever see is the negative.  Look for the positive, look for the opportunities that are available.

Step 2 – Set New Goals

The playing field has changed.  You need to reassess where you business is and where you want to go.  Will your current goals still realistically get you to your final destination? Or, do you need to revise your short term goals and strategies?

Step 3 – Get Around the Right People

You need to surround yourself with positive people who share your vision for success. Do you have the right people working with you?  Do they have the skills and the will to help you navigate your business during difficult times?  What about your business associates?  Are they bringing you up or taking you down? 

Step 4 – Create Quite Time to Think of New Ideas

It’s hard to stay focused during turbulent times.  You need to create quiet time each day to focus on your goals to help your mind to focus on what you need to do to get there. 

Step 5 – Planning

It all starts with a plan.  When you have a plan you can now determine what do I need to do or learn to achieve my goals. 

Did your business survive this far because you rode the wave of a good economy or because you have a well run business?  

If you are not sure, not our quick BusinessHealth Check and receive a free report prepared by our team that will give you valuable insights into your business.  www.bizhealth-check.com