The five steps we recommend for success are:
1. Aligning your passions to a business.
2. Recognizing your own limitations and getting help when you need it.
3. Determining the value of what you want to buy and why.
4. Being willing to walk away if it's not right.
5. Building upon what is great about the business you are buying.
1. Consider Your Passions
Our first tip is to align your passions with a business. Find activities that motivate you. This could be something as broad as making other people happy or as specific as a particular skill. In my case, my passion is sewing and fabricating beautiful items for people's homes; this is something that motivates me. As well, the beautiful items I create also bring people happiness, and bringing people happiness is also something that drives me.
When you are doing something every day, make sure that work is passion-driven. When your business is aligned with your passions, it makes all of the difference. By having a passion-driven focus, you ensure you can show up in a way that is genuine and authentic to your team and customers. It comes across in the daily work you do and the overall ethos of your business.
Another reason passion matters is that it is contagious. If what you do brings you joy because you are passionate, you're likely to share this joy with others on your team. Therefore, you become a better leader and drive others on your team to do work that motivates them and fuels their passions.
2. Recognize Your Limitations
Our second tip is to recognize your own limitations and get help when you need it. As a driven woman with a can-do attitude toward everything, I often have the temptation to do everything myself. What I have learned, especially in buying a business, was to understand my limits. I would encourage you to do the same. You may be excellent at operations but not at business valuations. When you discover where your talents start and stop, this is when it makes sense to bring in help. There are things at which we all excel, and it makes sense to bring in those who are experts in specific areas to fill in gaps, allowing you to focus on where you excel most.
3. Determine The Value Of The Purchase
Our third tip is to determine the value of what you want to buy and why. The valuation is something experts can help you with from a monetary perspective, but the intrinsic value is a harder to determine value. When you are considering purchasing a business, it may be similar to the purchase of a home. It is important to have specific, objective criteria when selecting a business, making it less likely that you'll rely heavily on subjective input. If you have subjective inputs that are harder to measure, you may end up making a decision that is based more on emotion and less on whether the business valuation meets objective criteria.
"Why" is one of the most important questions you can ask yourself. Continue to ask yourself "why" throughout the process of buying a business. Here are some starter questions to ask yourself: Why do you care about this specific business? Why this business and not another? Why buy now versus later? Why do your passions align to this business? Why will buying this business be the best decision for you?
4. Be Willing To Walk Away
Our fourth tip is to be willing to walk away if the decision to buy is not right. This is quite simple on its face, but it can be hard to carry out in practice. If you get emotionally tied up in buying the business, you can begin to rationalize reasons to buy. Be willing to recognize if your objective criteria are not met and that there will be another opportunity that does fit your needs later.
5. Lean Into The Positives
Our fifth and final tip is to build on what is great about the business you are buying. You are buying a business for specific reasons. Inevitably, there will be things that you want to change about it. However, it is important to build upon what is already great. Lean into the positives, whether that includes the reputation, the clients, the physical location or anything else.
We hope all of these tips are helpful as you think through what you should know when considering the purchase of a business. Best of luck in your future business endeavors.
Comments