In this post, I’m going to tell a story about Laura Steward and her company Guardian Angel.
Steward had gotten her IT consulting firm up to $400,000 in revenue when she called in a business broker for a valuation of her company.
Disappointed is an understatement when she learned that her company was worth less than fifty percent of one year’s sales.
The price of the business was low for two reasons:
Determined to sell for Top Dollar, Laura hired a business exit coach and under his guidance, she did what she had to do, transformed her business into a much more valuable and sellable company within 18 months by making just three strategic moves:
1. Designed a Monthly Program
The first thing Steward did was to design a monthly program called Angel Watch, which offered her clients ongoing protection from technology problems. Steward offered customers ongoing remote monitoring of their networks, pre-emptive virus protection and staff on call if there was ever a problem.
What she did was, she approached all of her clients with a calculation of what they had spent with her firm over the past 12-months, including the cost of her customer’s downtime.
She then made the case that by signing up for Angel Watch, they would save money.
BOOM – 90% of her customers switched from hourly to the Angel Watch program.
2. Doubled Her Rates
Next Laura doubled her personal consulting rates. That way, when one of the customers who decided not to opt into Angel Watch called her firm, they were quoted one rate for a technician’s time or twice the price to have Steward herself. Not surprisingly, most customers opted for the cheaper option and others chose to re-consider their decision not to sign up for Angel Watch.
3. Put a Survivor Clause In The Annual Contract
Her Exit Coach introduced her to a little thing called a “survivor clause” and she immediately included it in her Angel Watch contracts, which stipulated that the obligations of the agreement would “survive” a change of ownership of her company.
Laura successfully sold here business at a price that was more than four times the original valuation she had received just two years before, and the cost of hiring the business exit coach was a mere drop in the bucket considering the much higher price she received for the business.
Copyright: How To Increase The Value Of Your Business
Moral of the story: The Best Are Free Because They Save, or Make You More Than They Cost.
If you’d like to learn more about How To Increase The Value Of Your Business and hire a Business Exit Coach, visit: www.BizExitCoach.com