If you are thinking of selling your business at some point in time one area that you may want to consider improving is your business’ policies, procedures, and systems. Having quality, working, well-documented systems can not only mean the difference between succeeding in selling a business or not, but it can also have an impact on how much someone is going to pay for the business.
So what is a business system? There are two general definitions that I like. One comes from BusinessDictionary.com:
Methodical procedure or process, used as a delivery mechanism for providing specific goods or services to customers in a well defined market.
The other is from Michael Gerber’s book “The E-Myth Revisited“:
A system is a set of things, actions, ideas, and information that interact with each other, and in so doing, alter other systems.
Your business broker will have a far easier time getting a buyer to move forward if the buyer sees replicable systems that are set up or documented that the buyer believes they will be able to follow and implement. Without formalized systems a buyer will tend to wonder if they really have the knowledge necessary to operate the business. How will they know what to do to achieve the same results that you have?
A conversation with a good business broker or a small business management consultant that focuses on systems and operations may be worthwhile to figure out if this is an area that you should consider spending more time on. Michael Gerber’s books, and in particular, “E-Myth Mastery“, contain some good ideas on how to develop quality formal systems for a small business.
An extremely easy and intuitive database program that can be easily customized to create automated systems for a small business is Filemaker Pro 9. If you’ve been frustrated by the difficulty of using Microsoft Access, and the difficulty with customizing (without the assistance of a programer) of CRM tools like Goldmine and ACT then you will love Filemaker Pro. It is far more intuitive than these other programs, easier to use, and more customizable (which lends itself to use as a business systems platform). An easy-to-follow book that will help you with customization of Filemaker Pro is Learn FileMaker Pro 9.
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Click here to order “The E-Myth Revisited” audio CD.
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Codiligent Business Brokers – Portland, Oregon based business brokers representing sellers of businesses with $500k – $20 million in annual revenue. To schedule a free consultation to discuss the possible sale of your business you may contact Eric Williams at 503-535-8817 or E@codiligent.com
