VALUE BUILDING
VALUE BUILDING FOR BUSINESSES & CORPORATIONS
FocalPoint coaches work with some of the top business owners in the world helping them determine how much their business is worth before they decide to sell. Locally, we are headquartered in West Chester, OH and serve the greater Butler County area, including Cincinnati, Mason, Blue Ash, Sharonville and beyond.
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Value building in your long-term goals offers an advantage: a higher business value attracts optimal financial return and expansion opportunities. When executed efficiently, value-building will push you to the heights of your competition, earn the interest of major buyers and investors willing to purchase stock and shares in your business, and attract influential strategic partnerships.
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WHAT IS VALUE BUILDING?
While value building is primarily financially oriented, all aspects of running a successful business add to its total value. Owning an innovative and distinct business with an impressive customer base is valuable because of its sustainability and potential for even higher profitability in the future.
Economic value building involves:
- Increasing profitability.
- Increasing revenue.
- Market growth.
Overall value building includes:
- Gaining and maintaining a loyal customer base
- Refine business processes and operations for efficiency
- Cultivating a high-performing team
WHY IS VALUE BUILDING IMPORTANT?
Value building is essential in achieving optimal profitability, growth opportunities, expansion opportunities, and guaranteeing the most financial return and security upon exiting your business. Generally speaking, a higher economic and market value attracts top investors and collaboration deals and enables business owners to set higher sales prices for buyers and M&A deals.
HOW DO YOU MEASURE THE VALUE OF YOUR BUSINESS?
A go-to method to measure business value is subtracting your liabilities from your assets. However, a more reliable technique is using discounted cash flows to approximate the projection of your cash flow in the future using the following formula: Terminal Cash Flow / (1 + Cost of Capital) # of years in the future.
To assist my clients with measuring their current value, I offer my Broker’s Opinion of Value assessment that measures your business based on three different valuation methods. I also use a Projections Report to generate a financial projection of 5-10 years using a balance sheet, cash flow, and valuation using cash flows.
Next, a professional business assessment determines how competitive and innovative your business is and will be in the future within your industry. Business owners must know their company’s overall worth for a more accurate valuation – your profitability and potential for more profitability indicates how much your business is worth.
WHAT ARE SOME VALUE-BUILDING STRATEGIES?
- Increase your sales revenue, reduce debt, and implement expense reduction strategies for a straightforward approach to building your economic value.
- Develop marketing strategies for data analysis and more ways to reach your consumers. This process involves using marketing tools to create more personalized and compelling campaigns, lead generation, and measuring sales conversion rates.
- Product and service innovation: assess your current goods and services and compare them with your peers to stay competitive and distinctive.
- Use promotions and loyalty programs. Buyers and investors value businesses with more subscribers because of the assurance of customer loyalty.
- Build a highly skilled team with leadership capabilities. Cultivating a team with excellent performance ensures business operations run efficiently and smoothly with minimal direction, impressing buyers who value self-sustaining businesses.
Inquiring entrepreneurs and business owners who reside in greater Cincinnati, Ohio, including West Chester, Mason, Blue Ash, and Sharonville, can contact me today to start building your business value.