​There are countless reasons to sell your business:

• Retirement age.
• You reached the goal set for an exit plan.
• You have reached your frustration threshold.
• A desire to start a new chapter in your life.
• Family/health issues.

 
The big question is, are you prepared to sell?
 
When it comes time to sell your business, expect buyers to thoroughly examine every aspect of your business during the due diligence process.  When buyers find discrepancies with what they were expecting to find, deals can quickly unwind. Issues found during due diligence are used to request price reductions, negotiate more favorable buyer terms, or worst of all - kill the deal completely.
 
Here are the most common areas business owners should focus on when preparing for sale.
 
Poor Record Keeping
 
Please feel free to start here first! No buyer wants to dig through a shoebox of receipts and invoices to figure out if your business is a good investment. If your financial records are a mess, hire a bookkeeper or an accountant to straighten them out immediately. Financial records prepared and presented by a CPA firm are a lot more credible. Poor or missing financial records are the top reason a business is difficult (or impossible) to sell.
 
Maintaining Confidentiality
 
While getting the word out about a potential sale is important, keeping the confidentiality of that sale is often MORE important. Make sure confidentiality agreements are signed BEFORE dispensing any information. Provide just enough information to potential buyers so that they can make an informed decision about proceeding with a possible purchase. Don’t provide too much information without first getting a Letter of Intent (LOI) from the buyer. The last thing you need is competitors learning more than they should or customers and employees finding out.
 
Listing Too High
 
This one may be the most common and the reason businesses can sit for years without selling. Ignoring the many recognized valuation methods available and pricing for reasons like “I need to clear X” or “My brother-in-law sold his business for X” or “The new owner could add two crews and double sales” are not valuation methods. I understand that you may have a strong emotional attachment to the years of hard work, but mistakenly thinking the buyer will pay a premium for that emotional attachment is a big mistake. Spoiler alert – they won’t! Get a professional to pinpoint a listing value that is accurate, realistic, and able to attract buyers.
 
Inventory Issues
If you do not know where it is, what it is, how long it has been there or how much it cost, your inventory needs work. Depending on the type of business you are selling, inventory could be the biggest annual expense. Manufacturing, retail, distribution… they all require large capital outlays for inventory. Nothing makes a buyer more suspicious than an analysis that uncovers missing, over valued or obsolete inventory. Inventory can be a significant portion of the asking price. Make sure it is accurate.
 
Selling When Sales are Down
 
Unless you must sell when sales are down – DON’T. Covid is the most recent example. Owners who sold while sales were down during Covid did so at price far less than they would have received or year or two before – or a year or two from now had they given the business time to get sales back to and/or surpass previous levels. Declining sales (for any reason) is a huge red flag to buyers.
 
Mentally Checking Out
 
You have been doing all the right things for 20, 30 or 40 years. You’ve put in the long hours. Worked weekends. Skipped going on vacation. Now you have listed the business for sale. Keep your foot down on the gas pedal! Keep running the business as though you will own it for the next several years. The worst thing you can do is tune out and let the business you have worked so hard to build start struggling or underperforming.
 
Hire Professionals - Broker, Attorney, Accountant/CPA.
 
Line up a team of professionals that can guide you. Business brokers can assist you with valuation, marketing, identifying buyers and negotiating a deal. Accountants can answer questions regarding your financial performance and advise you on the best tax strategies. Attorneys can represent you, explain the legal aspects and finalize the deal.
 
Real estate agents don’t sell businesses, but it doesn’t stop them from trying. One of my top referrals is a business owner who had their business listing with a real estate agent only to see it expire with little or no interest. Then there is the business owner that wants to sell the business on their own. In most cases they have never sold a business before and will never sell a business again. What are the chances they will be successful? When will they find the time to do all the work that goes into selling a business?
 
Nobody wants to pay the fees professionals charge, but have you ever heard the phrase, “If you think it’s expensive to hire a professional, wait until you hire an amateur”? Selling a business is a difficult, complicated endeavor. Do yourself a favor and hire professionals to help. 

​Maybe it is just me, but if the idea is good April 10, July 22 or October 14, why wait until a new year to make a resolution?
 
The jokes are plentiful about packed gyms in January turning to ghost towns in February. Eating right and exercising is ALWAYS a good idea, yet there is something magical about people only getting serious at the beginning of each year.  In most cases, the enthusiasm evaporates rather quickly (hence the joke about packed gyms).
 
If you are planning a resolution, then you are already aware that something is wrong or lacking. What are you waiting for? Start improving today!
 
Are you willing to change the thinking or habits that got you where you are today?
 
This question is key and explains why so many resolutions fizzle out. You must change the mindset that got you where you are today if you want long lasting results. Emergencies and injuries will occur that prevent you from exercising according to schedule. Do not allow minor detours to turn into 3 months of avoidance and excuses. Build a mindset where exercising is as important as all your other priorities.  You are the only one that can hold yourself accountable!
 
Give your new approach time to work.
 
SPOILER ALERT –  change does not happen overnight!
 
You do not lose 50 pounds by eating right for a week. You do not get six pack abs after a week of sit-ups and crunches. Be patient. Be realistic. Give your plan time to work. Measure your results. If your goal is to lose 50 pounds, track your progress and celebrate incremental achievements. Doing the right things and sticking to your schedule keeps you moving steadily towards your goal.
 
Do your homework. Identify a mentor.
 
The harder the goal, the more research you should do in order to achieve it. You have been watching house flipping shows for years. This is the year you are going to flip your first house. How well do you know housing prices in your target area? Do you know repair costs? Do you have contractors lined up? I speak from experience when saying know these things before you try to flip your first house!
 
Do you know somebody who is already flipping houses in your target market? Invite them for coffee. Join local or social media real estate networking groups. You would be surprised how willing those with expertise are willing to share their experiences with a beginner. If the opportunity presents itself, consider collaborating with an experienced house-flipper.  
The bottom line.
 
Stop making annual resolutions that only turn into broken promises. If you are committed to changing things for the better, there is no reason to delay. Put your resolution into action today. Arm yourself with knowledge. Tap into a network of people willing and able to guide you towards your goal. Battle through frustration and temporary setbacks. Set realistic goals. Measure your progress. Keep moving in the right direction.  You got this!

​By order of size, airfare, hotels/lodging and meals comprise the three biggest business travel expenses. Today’s article focuses on ways to reduce hotel/lodging costs.
 
Hotels are willing to negotiate lower rates with business travelers – they just need to realize a reciprocal benefit for doing so. This article outlines what you need to enter into successful negotiations with hotel/lodging suppliers, get your business travelers on board and continue monitoring the program for long-term success.
 
Information
 
It all starts here. In a best case you are using a travel program sophisticated enough to retrieve historical information. If you are working with a Travel Management Company (TMC), they should be able to assist you in pulling the information you need.  As a last resort, you can reach out to hotel/lodging suppliers for historical information. Even if they do supply you with usable historical information, you will have to consolidate different supplier information manually. There may also be inconsistencies across formats making consolidation difficult. If you are not using a Travel & Expense Management system and you are not working with a TMC, your best approach may be to rectify one (or both) of those situations first. Hotels do not offer reduced rates based on rhetoric or anecdotal evidence.
 
Let us continue assuming you have access to the required information. Pull three to five years of data. Consolidate data based on suppliers, locations, stay durations, time of year or any way you see having value. Pulling three to five years of data affords you the opportunity to spot trends.
 
Suppliers. This tells you the total spend with specific suppliers. Your hotel/lodging spend may be fragmented across multiple locations. This demonstrates how much you spend across the entire supplier network affording you the opportunity to negotiate a more favorable rate for ALL locations.
 
Locations. Suppose you find that 80% of all spend happens in just three cities. Those three cities share a hotel chain with a large presence in each. Does that sound like an opportunity to negotiate a lower rate with that particular hotel chain? If your travel is scattered across multiple cities, identify the hotel chain with the most consistent presence across each and negotiate for better rates with them.
 
Stay durations. Longer stay durations equal lower costs for hotels. If travel patterns require hotel stays of at least five days there is an opportunity to convert that into lower rates. Hotel stays that carry over weekends present another exceptional opportunity to negotiate lower rates. Hotels have a captive audience with business travelers during the week and charge accordingly. To the contrary, many hotels struggle to fill vacancies on weekends. The fact that you have employees staying over weekends gives you a negotiating advantage.
 
Time of year. Seasonal, tourist dependent locations have no problem filling vacancies during the summer, holiday or event that makes them a desirable destination. What about the rest of the year? How about the situation where you perform maintenance work for one of these locations during the off-season? Do you think local hotels would be clamoring to put up two or three of your technicians for a few months?
You have poured through 3-5 years of data. You have analyzed the data internally and/or with the help of consultants. You devised a plan for negotiating with hotel/lodging providers. Either directly or with the help of a consultant, you negotiated lower rates. What comes next?
 
Travel & Expense Policy
 
You just put a ton of work into securing lower hotel rates. How do you ensure that your business travelers patronize suppliers with favorable rates? A great step towards achieving that goal is writing that requirement into your Travel and Expense policies. If you are working with a TMC, automating the process is much easier. They can program the requirements you specify into the booking process. If an employee attempts to book outside policy, those transactions are marked as exceptions. Will there be exceptions? Absolutely! Exception codes placed on transactions will tell you a lot. You want to make this process as easy as possible for your travelers. You want them out selling and servicing clients – not explaining why they booked the hotel they did and filling out paperwork.
 
Tracking, Reporting and Analyzing
 
You negotiated lower rates. You wrote the requirements into your policies. Now what? You need a system that tracks your performance, provides timely reporting and provides the right details for proper analysis. You need to develop Key Performance Indicators (KPI’s) that measure compliance, effectiveness and cost savings. How much hotel/lodging spend is outside policy? How much have you realized in savings? How many exceptions are there? Analyze exceptions to determine root causes. Maybe the supplier you negotiated with does not have sufficient vacancies to ensure availability. Maybe the exceptions are only happening in one market/locality.
 
You need this information timely. Monthly at a minimum. The further out poor behavior or lackluster performance goes, the more it is costing the company.
 
One Last Word - Ancillary Services
 
Most people focus on room rates. Rightfully so – it represents by far the largest portion of lodging spend. What about the ancillary costs associated with hotel stays? Internet? Parking? Laundry? The biggest one? Meals.
 
Why not include these elements into the negotiation process. If your travelers average 3+ days per stay look into getting free internet, parking and laundry. Everything is up for negotiation. You would be remiss if you did not at least discuss eliminating or reducing charges for ancillary services.
 
Meals. People travelling in groups tend to go out. People travelling alone – not so much. This may be an opportunity. If people travel and stay whole weeks (alone) selling or servicing clients/customers, they may be interested in a program that guarantees meals at reasonable prices. Everything is worth discussing. Prices can only come down.

​Allowing employees to work remotely is far from a new concept. Despite this, employers are still hesitant to accept working remotely. IBM was an early adopter when it came to offering employees remote work opportunities. In early 2017, IBM rescinded this arrangement for thousands of workers forcing them back to the office. Management (and IBM is not alone) are slow to embrace the concept that people work even when they cannot be seen.

​Are you paying people to perform a function or are you paying them to show up at a physical location? If you answered function, then location may be irrelevant. There is no arguing some jobs require a physical presence. Retailers. Restaurants. Warehouses. The irony? The jobs that do not require a physical presence are often the highly skilled, hard-to-find skills sets. If you look beyond an employee’s physical location, then your access to talent becomes worldwide.
 
If companies are reticent to trust employees they cannot see, imagine what they feel when they outsource functions. In most cases, considerably more will go into building up the trust factor. The first step to overcoming negative perceptions is spelling out how outsourcing is in the client’s best interest.        
 
There are distinct advantages to outsourcing non-core business functions:

• Eliminating recruiting costs associated with the function.
• Eliminating costs associated with a direct hire workforce – equipment/work stations, sick days, vacation, 401k contributions and health insurance.
• Eliminating downside risk of unfilled vacancies.
• Day-to-day management/supervision of function is no longer required – but make no mistake, outsourced or not an organization is always ultimately responsible for everything that goes on within it.
• Broad, uninterrupted expertise in the outsourced function.

 
We now arrive at the basis of this piece. If employers have a hard time trusting their employees, imagine the level of distrust when it comes to outsourcing business functions. There is NO implied trust to start. You read testimonials and get referrals, but you never really know until you start doing business together.
 
What can you do as a service provider to mitigate client concerns and build trust faster?
 
Do not promise what you cannot deliver
 
It sound obvious... but we all know there are plenty of service providers that do this very thing. If it is not a service that you can or will provide, make that abundantly clear before you accept the engagement. If getting an engagement depends on you performing a service you do not provide, then passing on the engagement is best for both parties. If you are a plumber, you do not take electrical jobs. The same principle applies here.
 
Spell things out in your engagement letter or services agreement
 
You cannot outline every possible scenario that may occur, but use your engagement letter or services agreement to get you as close to that point as possible. Spell things out. Advise the client to ask questions. Get the arrangement off to a good start by establishing common ground for expectations. Scope creep kills margins. A clearly written engagement letter or services agreement defines what is covered and what is not. Services not included in the original agreement should result in extra charges without creating animosity between you and the client. The strength of your engagement letter or services agreement goes a long way towards establishing a strong relationship right from the start.
 
Communication
 
If real estate is location, location, location, then remote support is communication, communication, communication! Do not make the client ask. Keep them informed. Let them know what is going on and why. Do not assume they already know or that no news is good news to them. Keeping your client informed on progress, developments, changes, problems, resolutions and updates reassures them you are on the job. People get tense with not knowing. We reach our own judgments and conclusions in the absence of information to the contrary. Remove those concerns by being an incredible communicator.
 
Response times
 
Do not allow yourself or your staff to get in the mindset of it is just another open ticket or trouble call. It may feel that way to you, but the client or customer rarely sees it that way. Oftentimes the client or customer views it as the biggest, most irritating thing they could possibly imagine. Open tickets or trouble calls demand swift responses. Slow response times only allow bad situations or perceptions to get worse. Which brings me to the last point…
 
Empathy
 
Again, it may not seem like a big deal to you, but the client or customer usually does not share that opinion. Put yourself in their shoes. I am sure there are other things they would rather be doing. A sympathetic ear does wonders for a person’s outlook. Understand their point of view. Antagonizing emotionally charged individuals rarely leads to a positive result. Listen and understand. Be genuine.