The business development process is important for any business to begin, but unfortunately one that not enough businesses start!
If you have a business and you are considering the business development process for your business, you might be wondering where to start – this article is to help you with your first steps to a successful development process.
The way I see any business development process is in two parts, with the first one being to increase business profitability, and the second to make the business less dependent upon the owners of the business. Both of these steps will make your business more valuable and will undoubtedly make your business a much better business to have.
Step 1 – Increase business profits
The best way to start this process is to firstly understand the 7 ways to grow a business, which includes getting more out of your existing customers by getting them to return to your company more often and in getting them to spend more when they visit. If you, as a business owner, can begin to focus on the profit drivers of your business and in understanding your Key Performance Indicators, you will then be able target profit increases.
Step 2 – make yourself redundant
This is an essential step to making your business more valuable because by making the business less dependent upon you (the owners) the business is a much more valuable proposition to would-be buyers. The reason for this is several-fold, and one mistake that many business owners make is to have significant relationships with the clients of the business, thereby tying them to the business and making it more of a risk when the business is sold to the new owners. So if the business owner puts distance between him or her and the customers this will remove the risk and help to add value to the business.
Another mistake is where the business owner remains involved with the areas of the business that require certain key skills. At the point the business is put on the market for sale and the owner is still involve with these key skill areas, this will require the potential purchasers to have those same skills to replace the owners at the point of sale, thereby reducing the value of the business.
If you begin these two steps on your business development process you will be happy you started.