A valuable business has intrinsic value. It’s a business entity run by a team that has spent a lot of time building up both their profile and revenue. Plenty of care has gone into its formation, and years later you’ll be able to reap the rewards. But before you get to that stage, you need to know what truly makes a business valuable! Moreover, you need to know how you can put these methods to work within your own company; check out our advice below to find out more.
A Large Amount of Repeat Custom
If you can make revenue week after week without worry, hitting the same (or similar) targets each time, it’s a clear sign you’ve captured the heart of your customer base. From running a subscription model to selling organic products that will need replacing, you’ve got people coming back for more on a reliable basis.
That’s a hard thing to build, but it’s the most valuable thing to have achieved. Indeed, if you can prove you’ve found this place in the market, your business valuation can double overnight.
Stable Relationships with Your Supply Chain
A stable supply chain, and holding good relationships with everyone who works down it, can be a rare thing in the business world. Disagreements occur all the time with big egos, and some companies fly from one supplier to another, and vice versa.
But if you’ve been with the same suppliers and vendors for the past few years, and count the owners of these businesses as valued members of your networking circle, it won’t be hard to attract further investment.
Purchasing Prime Business Premises
If you’ve got a good location, you can increase the value of your business by upwards of 20%. Prime operating premises ensure good footfall and often a sought after visual landscape – it’s why downtown offices are so popular in the business sphere.
So think about this in regards to your own company. Where are you operating from right now? And if you haven’t already made the investment, buying some commercial real estate could be the next step in your business growth.
Up to Date, Complete Records
A business that knows what it’s doing is a business that has value. That means keeping complete, up to date records throughout each quarter, stretching back to the moment you first started operating. For any company over 5 years old, this can be hard to achieve – data going back that far could have been lost or deleted or shredded by now.
But if you’ve got these records to show, you become far more trustworthy than any of your competition. If you want to bring in more shareholders and/or a new partner to the business, this is the best way to prove you’re legitimately valuable for them.
A valuable business is made of many components. However, the ones above tend to add the most profile and percentage back on. Follow them during the early stages of business development.
(Disclaimer: This content is a partnered post. This material is provided as news and general information. It should not be construed as an endorsement of any investment service. The opinions expressed are the personal views and experience of the author, and no recommendation is made.)
