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Increase The Cash Flow And Value For Your Business

Mar 20, 2009

  A friend of mine, Mark Green is the owner of Performance Dynamics Group LLC, which provides strategic services to small to mid sized business. He and I have formed and continue to form a business relationship to enhance each others practice. He wrote the following article, which I thought was excellent reading for our partners and clients.

Business owners can affect these value drivers with financial professionals such as B2B CFO Partners. They tackle these issues every day and have done so throughout their careers. Small to mid-sized business owners can be assured that our partners will provide the results required to positively affect your business, including asssiting in growing your business EBITDA, culminating in increased value for your company.

Visit our web site at http://www.b2bcfo.com/ to contact a B2B CFO to assist your business.

What Are You Doing to Enhance Your Value Drivers?

March 9, 2009

In a recent article entitled "Economic Downturn Gives Owners Time to Work on Value Drivers," my good friend Eric Donner, Managing Member of Regal Wealth Advisors, (www.regaladvisors.com) reviews how important value drivers are to maximize a business' selling price.

He goes on to point out that it is the work of the owner - not employees - to create and to nurture them. Value drivers include:

  • A stable and motivated management team.
  • Operating systems that improve sustainability of cash flows.
  • A solid, diversified customer base.
  • A realistic growth strategy.
  • Effective financial controls.
  • Stable and improving cash flow.

Due to the freeze in credit markets and a slowdown of M&A, today's economic environment - for the foreseeable future - gives owners time to install and/ or improve value drivers in their companies. It also gives them time to demonstrate the sustainability of the value drivers they create. Buyers want to know that success or growth charted in one year can be maintained over several years. They bank on (and pay for) a company's potential to grow, so they look very carefully at how long a company's value drivers have yielded positive results.

Experienced owners know that change takes time. Really experienced owners know that positive results from those changes take even longer - likely longer than even they expect.

Regardless of when you might sell, it makes good sense for owners to concentrate on those elements of their businesses that create more cash flow, more sustainability, and more future value. After all, isn't this why you're in business?

A great place to start is to evaluate how you're doing currently with respect to each value driver and then put a plan in place to improve each one - steadily and continually - over time. Then, when it finally is time to sell, you'll be assured a handsome return for having built something of lasting value.

Since founding Performance Dynamics Group LLC in 2003, Mark Green has spoken to and consulted with hundreds successful, closely held businesses and partnerships, helping them escape the frustration of being reactive. This enables them to stick to their own agenda and take more proactive control of their own destiny.  Our clients say that their relationship with us produces significant, measurable improvements to areas including cash flow, profitability, competitive advantage, sales and marketing effectiveness, and employee and customer loyalty.

If you would like to understand how our work might be just the right fit for your business, give us a call at (888) 720-7337

To learn more and to subscribe to our free monthly eNewsletter, visit us on the web at http://www.performance-dynamics.net/ or read Mark's blog at http://www.sustainablebusinesschange.com/.

Books


A collection of books from B2B CFO® to help any business succeed. Read the first chapter from books, including the Wall Street Journal’s book, for free.

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