Growth and Transition Services

Are you troubled by the growth of your company?

Are you losing sleep because you are concerned the value of your business will not be enough to support you when you are ready to retire?

Are you concerned that most small businesses are not saleable at the time the owner chooses to transition?

Recent studies of small and medium sized private businesses in the US show that 85% of the business owners have no exit strategy. Further, these owners have 75% of their net worth tied up in their businesses.

Unfortunately, most business owners sell or try to sell their business to another Owner-Operator which means that even if they are able to sell, they leave considerable money on the table. They do not realize there are other buyers who will often pay a premium for the business.

Prior to an effort to sell, many owners will pay for a valuation, but fail to understand that the traditional valuation does not represent what a buyer will pay. The value of a business to a buyer isn’t the cash flow, profit or assets. It is the probability and the reasons to expect certain cash flows or profits into the future.

In large companies, key investment decisions are made based on how the investment will affect Shareholder Value. Small business owners can do the same by paying attention to Owner Value. Having a clear picture of Owner Value and the forces influencing that value is critical.

Increasing a company’s value is a team effort. In addition to the owner and key employees, mgi works closely with the company’s CPA, bank and legal resources. If additional resources are needed in any of these areas, mgi’s affiliation network can help supplement.

mgi cannot help every business – the key factor is the level of the owner’s commitment to growth and change.

4 Types of Companies

• Mature industry companies
• Growth industry companies
• Emerging industry companies
• Declining industry companies

Competitive Forces

• Barriers To Entry
• Threat of Substitute Product
• Bargaining Power of Suppliers
• Bargaining Power of Buyers
• Competitive Rivalry Among Peers

Common Issues and Corrective Measures

• Differentiation
• Buyer-Supplier Pricing
• Fragmentation Strategies
• Integration
• Capacity Enhancement
• Mobility Barriers Pre-Emptive Maneuvers
• Life-Cycles
• Acquisition as a Growth Strategy

Contact Mark Gluck.