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Small Business Valuation and Its Benefits

If you watch the TV show Shark Tank, you often see business owners who lack an understanding about small business valuation. It is estimated that over 80% of small businesses have no financial estimate as to what their business is worth, nor do business owners seem to care. This is like me asking you how much money you have in the bank and you have no idea what I am asking you. You would not run your personal financial life this way; so why would you run your business with no understanding of the value.

So why should small business owners care about valuation? The answer is simple: The personal wealth of every small business owner is directly linked to the valuation of their business. If you expect to be worth a million dollars, then you better have a business that has a valuation of one million dollars. This is important because at some point every small business owner must retire and your retirement is based on the value of your business. Consider the fact that 70% of private companies in the United States will be put up for sale by 2030 and according to the National Federation of Independent Business, only 30% of all businesses that are put up for sale are sold. This is because most small business owners never pay attention to the valuation of their businesses.

Where does valuation come from? Valuation gets assigned based on the benefit stream of your business. The most common benefit stream is Earnings Before Interest Taxes Depreciation and Amortization or EBITDA for short. When you go to sell your company and retire from your business, you will sell your company for a multiple of your EBITDA. The bigger the company, the higher the multiple and the higher the valuation. The key is to get the multiple up which will increase your valuation. This requires an aggressive growth strategy linked to the valuation of your business.

The good news is that financial professionals are now offering cloud based solutions that empower any small business owner with a road-map for increasing value. The bad news is that this road-map can take five years or more to implement. Additionally, most road-maps require a strong professional team to facilitate the process. Having worked with various solutions, I would recommend small business owners consider one of two solutions:

1. Value Opportunity Profile – This is a comprehensive assessment of your business based on interviews with your management team. Specific recommendations are made on how to increase value in three phases.

2. Value Builder System – This is a 12 month program that starts with your own self-assessment, allowing you to decide if you want to embark on the program or not. Exercises are used each month to improve the valuation score of your business.

Regardless of how you get there, it is imperative for every small business owner to recognize how important valuation is to their own personal wealth. Because so few owners seem to grasp valuation and how to increase it, having a professional outside team can help. You need someone to orchestrate and facilitate the process while everyone else runs the day-to-day operations of the business.

How To Generate Leads For A Home Based Business – The Easy Way

If you are involved with network marketing, a direct sales business or any other home based business and you are sick of annoying your friends and family, handing out DVD’s, paper cards, post cards and harassing complete strangers who happen to have the misfortune of standing 3ft away from you at any given time, you are going to love this article.You will appreciate that the ability to generate leads for a home based business is the life blood of any opportunity that you are involved with, in fact it is the lifeblood of any business you care to mention. You can have the greatest product, service or opportunity you can think of, but if no one knows about it, it’s not much use.The traditional way to generate leads for a home based business has been to literally ask everyone and anyone if they are interested in what you are selling, or are they interested in joining your opportunity. A lot has been written about how you can disguise this information and lead the prospect around to your way of thinking and ultimately secure the answer ‘yes’ from them. Now that is OK and does work to a certain extent but the two main problems are 1) It takes a long time to build up any sort of business and 2) It leads to a lot of rejection, as not everyone has the mind-set and the foresight to see what your opportunity has to offer. In a nutshell you are cold calling people and it is the biggest waste of your time going.So how do I generate leads for a home based business?The easy way to generate leads for a home based business is to leverage the internet and become the hunted. What does that mean exactly? Well think about it, what do people primarily use the internet for? The answer to that question is research. If someone id thinking about joining a home based business, they will more than likely research it on the internet first. Will they find your opportunity there? Will they find you personally on the internet?You will have far more success using the internet to generate leads for a home based business because you will find people who are actively searching and pre sold on the idea of joining an opportunity, you will now have to convince them that it is you they should be joining and partnering with.Top ways to leverage the internet to generate leads for a home based businessThe following are three of my favourite strategies to help generate leads for your business by using the internet. This will serve as a guide for which you may undertake some more research.1) Video marketing – Record videos and upload them to YouTube2) Facebook paid advertising – Target the exact profile of your ideal customer by leveraging the information from their profile.3) E-zine solo adverts – send your advert by itself to a list of people who are interested in your subject and have asked to receive more information on the subject.The above are just some examples of how you could leverage the internet to generate leads for a home based business. If you would like to find out more please check out the link below for more information.

Get the Most From Your Home Based Business

If you’ve found this article, it’s probably because you are looking for something and, I’m going to hazard a guess that it’ll be either a way to earn more money, have more leisure time or a combination of both…yes?Also, guess what? I bet you’ve been unhappy, overworked and underpaid in your current job for far too long and, on top of that, you work far too many hours, you’re totally unappreciated and are fed up with the commute every day.This has really hit a nerve… Right?Oh, but then nowhere near as much as the title of this article.”Get the Most From Your Home Based Business”. “Oh no! not another Work From Home scam” you’re thinking. Your mind catapults you back to trudging the streets in the cold and the dark with endless bags of leaflets to put through endless letter boxes. You cringe as you remember being phoned by the local council for fly postering on lamp posts, why did they always pick on you?….The phone number at the bottom of the poster might have been the give away! Your sponsor or mentor seldom called or contacted you and when they did, they didn’t seem to know you anyway. Then you sink even further as you remember how you consumed more of the company’s products yourself than ever you sold and how you stumbled clumsily down the road with every type of brush, broom and cleaner stuck in every nook and cranny of your body and… what have you got to show for it?Yep, you’ve wasted more money on unsuccessful attempts at “Work from Home” businesses than you ever want to admit… and why? Only one simple reason…. you just needed to know what to look for…A system that worked!I know it sounds really too simple but it’s true. OK, even as on-line opportunities began to emerge which cut out the leaflet posting and fly postering, I bet you still paid for some of these, made little or no money and then was just been left to get on with it yourself?One person who can totally sympathize with you in all this, is me, as I’ve been where you are too. And like me, you want to work from home, so what do you need to look for?Well, when you look again to set up an on-line business. Look for a business opportunity that employs good business systems that you can follow. Use this check list and do your due diligence as if you were setting up a traditional business.
Check that you’re not going to be left alone to fend for yourself. Choose a mentor carefully. Ensure they always answer your questions promptly and correctly. Make sure you feel comfortable with them and have the ability to inspire you too.
Check that you will have access to other people (a network) who also know what they are doing and who you can also bounce ideas off and learn from.
Ensure that there is plenty of training available covering all aspects of the business, preferably available 24 hours a day.
Look for proof of easy start up guides, preferably stepped detailed plans that you can work through at you own pace to ensure your business gets off to the best possible start.
Check to see if you can outsource any of the work you can’t or don’t like doing, after all we are not all salesman that enjoy closing deals!
Find out exactly how much it is going to cost you to buy in. Be aware of your costs at all time and keep them as low as possible. However, a cheap start up might not always be the best option, find out what you’re getting for your money.
Ensure that the compensation plan is clear. Know what you’ll earn and how quickly you’ll get paid – ensure you’re the first and not the last in line!
Read and check out testimonials, the more the better.
To find the ideal home based business you must have ticked all these boxes. Proven business systems are the key, as if they are proven to work, all you have to do is copy them and they’ll work for you too. People are also essential, many of us don’t want to have endless meetings and telephone calls and many of us also hate selling. There are plenty of business opportunities out there where you don’t have to talk to another living soul if you don’t want to, which is fine, as there is e-mail and social network sites now where you can communicate with people without lifting the phone or even leaving your house. But the Internet, where a lot of these opportunities are now based, is changing so fast and it is essential that you keep well informed so you’ll need people around you to help and guide you and in return you’ll be able to do that for others in the future which will be a very enjoyable and satisfying part of your business.So, to “Get the Most From Your Home Based Business” Remember be thorough at the beginning, do your due diligence and never forget that you’re in this for the long term so build solid foundations. You will need to work, be under no illusion, but work smart not hard and the rewards will be fantastic!

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