The Hidden Goal of a Smart Landscaper – Building A Valuable & Sellable Landscape BusinessTomChilders
What are your business goals for the year? If you’re like most owners, you have a profit goal you want to hit. You may also have a top line revenue number that’s important to you. While those goals are important, there is another objective that may have an even bigger payoff, building a valuable and sellable landscape business.
But what if you don’t want to sell? That’s ok, focus on increasing the business’s value. Here are six reasons why building a valuable and sellable landscape business should be your most important goal, regardless of when you plan to sell.
1. Sellability means freedom – One of the fundamental tenants of sellability is how well your company would perform if you were unable to work for a while. As long as your business is dependent on you personally, there’s not much to sell. Making your company less dependent on you by building a management team and creating just-add-water systems for employees to follow means you have the ability to spend time away from your business. Think of the world of possibilities that would open up if you could choose not to go into the office tomorrow.
2. Sellable landscape businesses are more fun – Running a business would be fun if you were able to spend your days on strategic thinking and big picture ideas. Instead, many owners spend the majority of their day on the grind: the government forms, the employee performance reviews, bank reconciliations, customer issues, looking at bids and expenses, etc. The boring details of company ownership can take some of the enjoyment out of owning a business—and it is exactly these tasks you need to get into someone else’s job description if you’re ever going to sell.
3. Sellability is financial freedom – Each month you open your bank and/or brokerage statement to see how your accounts are doing. Not because you want to sell or liquidate anything, but because you want to know where you stand on the journey to financial freedom. Building a sellable landscape business also allows you peace of mind, knowing that you’re building something that—just like your retirement account—has value you could choose to make liquid one day.
4. Sellability is a gift – Imagine that your first-born graduates from school and as a gift you give him your prized 1967 Shelby Ford Mustang. Your child takes it on the road, but after a few miles, the engine starts smoking. The mechanic takes one look under the hood and declares that the engine needs a rebuild.
You thought you were giving your child an incredible asset, but instead it’s an expensive liability he can’t afford to keep, and nor can he sell it without feeling guilty.
You may be planning to pass your business on to your kids or let your young managers buy into your company over time. These are both great and admirable exit options, but if your business is too dependent on you, and it hasn’t been tuned up to run without you, you may be passing along a major challenge.
5. Nine women can’t make a baby in one month – There are some things in life that take time, no matter how much you want to rush them. Making your landscape business sellable often requires significant changes; and a prospective buyer is going to want to see how your business has performed for the three years after you have made the changes required to make your business sellable. Therefore, if you want to sell in five years, you need to start making your business sellable now so the changes have time to gestate.
6. Value & Sellability are good indicators for business success – Running a successful landscape business should result in a valuable and sellable business regardless of your exit plans and desires. Knowing how you stack up in this regard is a great metric and can serve as a motivating and guiding force as you work to continually improve.
Are you curious about how valuable and sellable your landscape company is and what you would need to tweak to sell it when you’re ready? Then it’s time to get your Value Builder Score via the questionnaire below. It takes about thirteen minutes and your responses are kept confidential.
Below is the link for the value builder questionnaire, but wanted to share a couple of points with you as you review and consider.
- The typical small business scores under 80 – the average is 59. So if someone wants to improve their score, the Value Builder System offers two programs to help. One is a quick and easy diagnostic that is thorough, quick hitting and economical. The other is a more thorough approach that takes more time and is a good fit for an owner who wants to really dig in and optimize.
- Most of this is based on John Warrillow’s work and research and is in his books such as The Automatic Customer and Built To Sell. His database of companies that have gone through his system exceeds 10,000. His “why” is because he considers himself a small business advocate and the Robin Hood (his words) for entrepreneurs and small businesses. He loves to share his stories of selling his businesses and feeling like he was on an island.
The site will be updated with more info on the program in the near future but if you have any immediate questions, just email me, firstname.lastname@example.org.
You can complete the questionnaire on the Value Builder Score page.