Most business owners are surprised to discover the existence of a value gap, or a discrepancy between what your business is worth and the amount of money you will need to fund your future. There are a number of factors that can cause this gap, including:
Owners that discover a value gap can often experience shock or despair – feeling like there may not be enough time to secure an adequate financial future. Fortunately, there is light at the end of the tunnel with some smart planning and knowledge application to increase the value of your business.
Once you determine the existence and severity of your value gap by reviewing your financial situation, you can create a plan to address it. The question to ask yourself is: if you were to retire right now, will you be able to extract sufficient funds from your business to fund your desired standard of living? Most often the time to start working towards creating a secure financial future will be right now.
Creating a master plan that involves both personal and business goals is the first step towards eliminating the gap. This plan should include:
This plan will hold you accountable towards fulfilling your dreams of retiring confidently with enough money to live comfortably. Since it’s easy to fall back into old patterns, we encourage you to review your plan regularly with your advisory board to ensure goals are being achieved and your value is increasing. Developing a vision board of your future goals will also help to motivate you to strengthen your business and position it favourably for a potential future sale.
The sooner you address your value gap, the sooner you will be able to achieve the lifestyle you deserve. Now is as good of a time to start as any. Our online business value attractiveness calculator takes only 10 minutes and will provide you with a customized report with areas to improve on before you sell your business. Try it today!