We, at Plutus Consulting Group, have invested in a number of Diagnostic Tools that enables us to clearly understand the road blocks you are experiencing, the challenges you are facing in moving your business forward and where your company is in its evolution.
Over 500 companies were analysed over the course of many years; some common elements emerged regardless of industry or country. From raw start-up to fully matured business we found that all businesses went through 7 stages. For you or any business owner to really receive full value for your business when transitioning or selling your company needs to be at a stage 5 or higher. The value of your business increases and the EBITDA multiple can go up if you are a stage 6 or 7 organization. This is critical to a number of business owners, since they are counting on the sale of their company to fund their retirement. Surprisingly many business owners struggle with achieving the transition through to a stage where their business has real value beyond the assets or value of their book of business.
The seven stages are:
- The Start-up Stage – An exciting and scary time; honing a business plan, doing some market research and validating the potential!
- The Specialty Stage – Your starting to get traction and now need to focus the business, develop your Brand and do some financial Benchmarking.
- The Synergy Stage– this can be a very frustrating stage for most business owners. They are growing beyond their ability to manage every component of the business – need help!
- The Systems Stage – This stage is all about continuous improvement. Developing further the structure implemented in stage 3.
- The Sustainability Stage – The business has traction now and is ready for expansion, replication or franchising. Selecting the right path for growth is critical.
- The Saleability Stage– The Company is becoming recognized as a force in their Industry sector; now need to polish the financials and improve the management capabilities.
- The Succession Stage– The business has reached a point where the ownership can realize maximum valuation for the company. Wealth management becomes key.
Often a company will straddle a few stages or has a need to complete some of the missing elements from a few stages. We completely understand the difficulties in taking a business from early stages to stages 6 and 7. We have done it successfully a number of times and have witnessed firsthand the significant increase in valuations. However, these transitions are not easy; they require discipline, a willingness to change the business and your commitment to see it through.
This is where the Plutus advantage really shines – we stay with you to help you through the tough spots and ensure that you truly transition your business and realize increased value of your company!