As a Business Broker I have analyzed hundreds of small businesses and these are the five most common mistakes I see their owners make.
- You are the business
Being too involved in the mundane work of the business is a common mistake of the small business owners. A Restaurant owner washing dishes or flipping burgers. A convenience store owner behind the cash register. The adage is true. You should be working on your business and not in your business. Too closely identifying the business with yourself has another drawback. Customers will only want to deal with you and when you are not present your business will suffer. Too many small business owners are unable to take time off. Empower your employees so that your customers feel comfortable dealing with them.
- Not valuing your employees
Employees are your greatest asset. Over the years I have seen how the most successful owners value their employees. They empower them, pay them above average wage and treat them well. Less successful employers complain that employees “don’t want to work”. But perhaps they don’t want to work for low wages while being mistreated. The employee/employer relationship has changed and in this tight labor market, employees are no longer content just to have a job.
At the end of the day happy employees mean happy customers. And the cost of constantly hiring and training far outweigh paying your best employees a little more.
- Not managing expenses
It’s very easy for expenses to get out of hand. One small bill gets added to another and pretty soon your margins are being squeezed. Make it a practice to frequently review your expenditures. Ask yourself if a particular expense is really needed and does it contribute value to your business.
- Neglecting your online presence
These days your online presence is everything. Google business reviews, Facebook page, a Linkedin profile are all essential. Most importantly you will need a good website. According to one source 70%-80% of customers will visit a Company online before making a purchase. If you do not have a standout internet presence you are losing out. Unless you are especially computer savvy it is best to find a good WEB/SEO company to manage this for you.
- No succession planning
What will happen to your business when it’s time for you to retire. Do you have a son or daughter willing to take the reins? These days its increasingly rare for children to take over their parents Company. A key employee may be the answer, but most people are employees because they don’t want the risk/responsibility of ownership. The best option may be to sell your business. A Business Broker can help you prepare your business to sell. Its best to reach out 2-3 years before you are ready to retire. Properly preparing your business for the market means that when the time comes it will sell quicker and likely for a higher price.
Anthony John Rigney is the Broker and owner of Quorum Business Advisors. He has 15 years of experience in Business Brokerage and has helped guide many transactions to a successful conclusion.
If you are interested in the services of Quorum Business Advisors please contact us today.