7 New Year’s Resolutions to Build a More Valuable Business
For many, the end of the year and the start of a new year is a time of reflection and resolutions. It’s a time to reflect on the year’s achievements and to set goals for the year ahead.
Some people will set personal goals like losing weight or creating new habits, and most business owners will set goals focusing on achieving certain revenue or profit milestones. But if your goal is to own a more valuable business in 2024, here are a few New Year’s resolutions worth considering:
- Take a two-week holiday without checking in with the office. When you return, you’ll see how well your company performed and where you need to make a key hire or create a new system.
- Write down at least one process per month. You know you need to document your systems, but you may be overwhelmed by the task of taking what’s inside your head and putting it down in writing for others to follow. Resolve to document one system a month, and you’ll own a more sellable company by the end of the year.
- Offload at least one customer relationship. If you’re like most business owners, you’re still your company’s best salesperson, but this is a risk to the business and can be a liability in the eyes of a potential acquirer (whether you are considering selling or not). You should wean your customers off relying on you as their point person and work towards none of your key customers thinking of you as their relationship manager.
- Cultivate a new relationship with a new supplier. While having reliable suppliers is essential, an over-reliance on a select few can pose a risk. Cultivate relationships with new suppliers, ensuring a diverse network. This keeps your primary suppliers motivated and provides alternative sources for critical inputs.
- Create a recurring revenue stream. Valuable companies can look into the future and see where their revenue will come from. Recurring revenue models can vary from charging customers a small amount for a particular level of service to offering a warranty or service contract.
- Track your Net Promoter Score (NPS). The NPS methodology is the best predictor that your customers will re-purchase from you and/or refer you, two key indicators of a healthy and successful company. If you do not do so already, start measuring and recording this crucial metric.
- Get your Value Builder Score. All goals start with a benchmark of where you’re at today. By understanding your company’s Value Builder Score, you can pinpoint how you’re doing now and identify areas for improvement to increase your company’s value over the course of the year ahead.
Many business owners will set New Year’s resolutions around their revenue or profits for the year ahead, but those goals may be short-sighted. Instead of just striving to build a bigger business, consider making next year the year you build a more valuable one.
If you have any questions about this article or would like to speak to one of our advisors about how you can improve the value of your business, please do not hesitate to contact us or call our office on (08) 6212 7200.