Exit Planning Exchange

By Laura Kevghas

The phone rings unexpectedly one day, and on the other end is a CEO wondering if you would be willing to sit down and talk about selling your business. You may or may not discuss a purchase price. You may or may not commit to even a meeting, let alone an exchange of information. But nonetheless, that single unexpected phone call can touch off one of the most significant, emotional and time-consuming events in your life as a business owner: deciding whether to sell your company. The way you respond, both initially and in the weeks that follow, can have an impact on your company, your employees, and the value you can realize from the sale of your business.

For this article we asked experts in accounting, law and business consulting for advice on what to do when you receive this kind of phone call. Their suggestions – on everything from evaluating pricing, to managing proprietary information, to establishing a team of advisors, to performing due diligence on the buyer – can help you navigate the complexities of your unsolicited offer, and make the most of your opportunities, whether you decide to sell or not.

Why This Matters:

• Planning ahead can make the unexpected offer manageable
• Contemplating selling your business is the most significant and emotional decision you’ll ever make
• Even considering an offer can affect your company, your employees and your family

Top ten rules for evaluating unsolicited offers

Though every company – and every deal – is different, we have found that there are a number of simple principles that can simplify the process of responding to an unsolicited offer and help you make the right decisions. Here are ten things to keep in mind when someone offers to buy your business:

Rule #1: Don’t wait until the offer comes to plan your response

“Unsolicited offers can come at any time,” says Tom Sherwin, founder of the consulting firm CEO Resources,Inc. “Ideally, CEOs should have a strategic plan in place before they get an offer.” That plan doesn’t have to be complicated, he adds. CEOs simply have to know whether they plan to continue to manage the business over the next three to five years, or whether they would be open to the possibility of a sale.

Linda Swerling, founder of Level II Solutions, adds that business owners should consider their personal, as well as financial, goals. “How long were they planning to work? What was their exit strategy for the business? All these things need to be written down,” she says.

Sherwin says that he regularly meets with CEO’s who maintain that they have no interest in selling theircompanies; yet it’s often merely a question of price. “We play a game of ‘what if’ scenarios, usually over lunch,” he says. “What if someone offered you 20% more than you think your company is worth? What about 50%? You end up constructing a game plan. Say, for instance, that you would consider offers above 25% of some benchmark. At 50% you would actively pursue a deal. And at 100% above the benchmark, you schedule a closing. Then you put that game plan away until the time comes.”

Rule #2: Know what your company is worth

Of course, you can’t evaluate an offer without having a very good idea what your company is worth. Public companies learn their value every day when the market closes, but for private, closely held companies, it may be worth spending the money  required to get a good valuation at least every three to five years, Sherwin suggests.

Amy Mastrobattista, an attorney with the Boston law firm Ruberto, Israel & Weiner, says that the first stop should be your CPA, who can walk you through the most appropriate valuation techniques for your company and industry. “It’s also not a bad idea to develop a relationship with an investment banker far in advance of any planned exit,” she adds. “They can incorporate their knowledge of market conditions, recent transactions and prevailing multiples in your industry to give you a more accurate view of your company’s value.”

“To truly understand your company’s worth, though, you need accurate and timely financial information,” asserts Swerling. “Your current performance relative to last month,the year-earlier period and budget all influence the value of your company.”

The integrity of your financial data is important, not just in understanding the value of your business, but in presenting it to outsiders, comments Margery Piercey, a CPA with the accounting firm Wolf & Company. “First impressions are important when you put numbers in front of a potential buyer.  And it can have an immediate impact onvalue if your financial statements aren’t in order. You reallyneed to make sure that your numbers are presented in sucha way that you’re going to be maximizing value, by ensuring that your financial statements are in compliance with GAAP and industry-specific reporting norms, and that you’ve identified any owner-related or other expenses that won’t continue post-closing.”

Rule #3: Protect your company’s proprietar y informat ion

Very early on, potential buyers will often request extensive proprietary information about your company.  It’s important to provide information in stages – very little early in the process, and further information in pieces, only as you become comfortable that a transaction with this potential buyer is desired and likely.

However, Mastrobattista points out that “Before you share any information at all with a prospective purchaser, you need to have a good confidentiality agreement inplace. This is the case even if the potential acquirer is not a competitor. You don’t want your confidential business information to be used for any improper purpose, even if youthink it’s innocuous.”

Piercey concurs. “Usually in the early stages of getting to know your potential buyer, you are going to be disclosing a good deal of information,” she says. “It’s important that your attorney has put a strong confidentiality agreement in place to make sure you’re properly protecting trade secrets, customer lists, and other things that contribute to the value of your company. That way, if the deal doesn’t go through, you haven’t given away some of these things of value.”

Rule #4: Keep it quiet

These negotiations should, in most cases, be kept confidentialfor as long as possible. “The impact on the employees of even considering a sale of a business can be very unsettling and actually can reduce the value of the business,” says Piercey.

“Control of information is critical,” adds Mastrobattista. “Rumors about your deal can affect not just employees, but customers, vendors and lenders. If the transaction falls through, it can even have a negative impact on your company’s reputation, since people may assume there was something wrong with your business.”

Mastrobattista advises CEOs to think carefully about who within the company needs to know the details of a transaction and to limit the access to this information to a small group of top managers for as long as possible.

Rule #5: Put together a team of expert s

“Acquisitions take up a good deal of time – incremental time over what the CEO is already spending on the business,”says Piercey. “Moreover, they require experience and insight that most CEOs don’t have. As a result, it is critical that the CEO bring in people who are experienced in transactions: investment bankers, accountants, lawyers and tax advisors.”

“You’re only going to sell your business once, and it’s a steep learning curve,” cautions Sherwin. “Why would you try to do that yourself?” He advises seeking out experienced transaction professionals, people who specialize in M&A and work on multiple transactions every year. He recommend stalking to other CEOs who have sold their businesses for referrals to investment bankers in your market.

Mastrobattista adds that you can often find these people by asking your current team of advisors. Your regular accountant, for instance, canusually recommend a taxspecialist experienced in M&Atransactions to augment his or her expertise. Your general counsel may know an M&A lawyer. “The best place to find good people is from good people,” Mastrobattista says.“Talk to your trusted sources for business referrals and evaluate independently.”

Rule #6: Scrutinize deal structure and provisions carefully

Price is one key factor in a deal, but it’s not the only one.“You and your team should look closely at the structure of the transaction,” says Mastrobattista. “Is it cash? Is it notes? Is it stock? Are there hold-backs? Are there earn-outs?” There are tax implications to all of these different purchase price methods that a good tax advisor will help you evaluate. Each structure has different risk implications as well, with payment in seller notes or earn-outs increasing the risk that you won’t receive the value you expected from the transaction.

Rule #7: Think about other possible acquirers

“Just because one person is interested in buying your business doesn’t mean you have to sell it to them,” says Sherwin, adding that there may be multiple offers out there, in addition to the unsolicited one.  For CEOs who are interestedin pursuing a sale, he recommends widening the circle of potential buyers, not just approaching known competitors, but a larger circle of complementary, often larger potential buyers.

Unearthing these buyers may require an investment banker’s help, Sherwin adds, and Mastrobattista concurs that their insight can be invaluable. “You need to look at the state of your company and of the market as a whole when you think about soliciting other offers,” she says.

Deciding to widen the circle of potential buyers carries with it the risk that the buyer who gave you the unsolicited offer may not wait for you to test the market. This is when an investment banker can be particularly helpful to determine if the offer on the table is pre-emptive enough to be worth accepting to the exclusion of other potential buyers.

Mastrobattista adds that bankers can tell you more about the market’s appetite for deals like yours, but that ultimately, the transaction should be done on your timetable. “There’s nothing worse than rushing a deal through, not understanding all the implications of price and market conditions, and then getting bitten in the end.”

Rule #8: Check out the buyer carefully

CEO’s should also scrutinize their potential buyers carefully.  Sherwin says he is always astonished when a company owner agrees to a transaction without first verifying that the buyer can pay. “There are a lot of people out there who can’t close,” says Sherwin. Particularly in today’s tight credit climate, you want to know that the buyer has the financial capacity to close the transaction.

Rule #9: Plan your post-transaction role car efully

You sell your company, and what then? Every one of our experts maintains that you should think carefully about what, if any, role you play in the acquired company.

If the transaction is structured to include an earn-out, you may wish to continue to run the business through the earn-out period to ensure that the maximum incentive payment is earned.

However, Swerling suggests that CEO’s consider the implications of their shift from owners to employees, if they continue in the business. “You’ve been managing this business for years or decades. You’ve been doing everything your way, maybe with the support of some hand-picked managers. Now it’s not yours anymore, and the company you built will change,” she says.

Rule #10: Don’t be afraid to walk awa y

Given the intense and emotional nature of negotiating a sale, our final rule is perhaps the hardest to follow. If a transaction turns out not to be in the best interest of you or your company, you need to be willing to pull the plug.  Not every deal is a good one.  Sometimes even attractive transactions can turn sour over the course of negotiations, or as market conditions change. Even if you’ve spent months working on a transaction, it may still be better, at a certain point, to simply walk away.

Unsolicited doesn’t have to mean unanticipated

Unsolicited offers happen more often than you think – and they can be a welcome wake-up call to business owners caught in the day-to-day details of running a company. Yet they shouldn’t take you completely by surprise. Sound preparation for an unsolicited offer is good strategic planning.

By developing a strategy that says whether, when and for how much you would consider selling, by obtaining accurate valuations of your business on a regular basis, and by developing relationships with seasoned M&A advisors now, you can make sure that you maximize whatever opportunities come your way in the future.

Laura Kevghas is a principal at Mirus Capital Advisors, Inc. Founded in 1987, Mirus Capital Advisors is a middlemarketinvestment bank that specializes in merger advisory, capital-raising services, fairness opinions andvaluations to entrepreneurs, corporations and professional investors. By combining a proven process, industry andtransactional expertise, and personalized service, Mirus has completed hundreds of transactions for both publicand private companies. Our affiliate Mirus Securities, Inc. is a registered broker-dealer and FINRA/SIPC member.Additional information about the firm is available on our website www.merger.com.

By Stanley H. Davis and Kathryn B. Earle

by The Bigelow Company

Owners thinking like managers . . . managers second guessing owners . . . one thinking about tomorrow and the other obsessed with today. Enough of a conflict, but what if they are the same person? When is the last time that you “wore your owner’s hat” and thought about your business exclusively as the owner of it, not from the perspective of simply managing it?

Most CEO’s who are also the principal owners of a business they manage don’t distinguish between their dual roles and responsibilities so as to optimize their professional performance. The owner’s perspective asks tough questions like: How good is this investment? Is it in the right kind of assets? Are they as productive as they ought to be for me? How are my managers doing in implementing our business plan (especially if one of them is me!)?

It is difficult to be of two minds, to think like an owner and as a manager when you are in fact both. But how many of us would make an investment in securities, for example, and then not bother to measure the performance of the investment that we own? Yet, that is usually the case with CEO’s who both own and manage.

Of course, background and education shape us to think primarily as managers. We ask: What is the plan? Who are the target customers? Is the pricing right? Can we collect the receivables more swiftly? Et cetera. Accordingly, most Owner-CEO’s are not in the habit of thinking like investors, but successful entrepreneurs are best recognized by the way that they wear their two hats. It is required if a successful enterprise is to increase shareholder value.

As managers, we have a vested interest in keeping the status quo (what made us successful in the past), keeping the peace, not being disruptive, and fighting change until it is forced upon us. As owners or investors, we are determined that the companies that we invest in must change to address an ever-changing external market with a differentiated thrust.

Owner-managers often have no regular forum in which to think exclusively about their businesses as the owners of them, not (just) as the managers of them. So every ownership decision (as opposed to management decision) comes as a surprise to the rest of the management team, because it is an unusual occurrence, a special situation. Often, owner influenced decisions are put off and only made when forced by a significant outside event.

It is axiomatic that 80% of business success is a result of picking the right strategy for a given situation. In owner-managed businesses, it is in the role as business owners that there is the responsibility for strategy . . . for allocation of (finite) resources – people, cash, and time. Businesses, their owners, and other stakeholders benefit when there is a regular forum for the owners to think about resource allocation relative to strategy and performance. We call it a Board of Directors.

© The Bigelow Company LLC - www.bigelowco.com

By Larry Girouard

Terms like strategic plan, business modeling, data collection, data generation, business “Outcome”, algorithms, and the like, are not words that are commonly used in today’s business meetings. (Note: Outcome is defined as all the goods, services and touch points that a customer encounters when dealing with your company. The company outcome is what the company delivers, and the customer experience is how the customer relates to this outcome.) I am reminded of presentations that I made in 2007 at a half dozen conventions around the country. I role-played with the audiences of CEOs and senior managers, asking them to pretend that I was the decision maker at a target account that they were trying to penetrate. If they had just 15 minutes to convince me to buy a product or service from their company versus their competition, what would they present to me?

I asked them to take 60 seconds to write down five items that they would discuss. At the end of the minute many had not completed this short list of five items. Surprised! Try it yourself … one minute and five key items. The fact that this was not an easy exercise for these senior managers is significant.

The second question I asked, with a show of hands, was, “How many of your company’s measure the performance on the five, or less, items listed on your sheet?” I would be exaggerating if I said that more than 1%-2% raised their hands.

The fact is that very few companies measure anything beyond financial performance. If I am the buying influence at a target account, I am inundated with sales people telling me how great their companies are, yet, almost no company presents the historical performance data to convince me that their value proposition has any punch behind it. As the buying influence, on what basis do I make my decision?

I had one attendee that listed “Our experienced people” as one of their five. To that point I responded as the buying influence, “So what, what does that mean to me?” I understand what “on time delivery” means to me, but I do not have a clue how “having experienced people” impacts my company. The measured quality of the work from these “experienced employees”, and how this quality impacts what I am buying from your company, will certainly play a part in my decision making.

When you think about it, the buying influence at a customer or target account only cares about the ”Outcome” from your company, and how it meets their needs. The buying influence could care less what happens inside your company. As the buying influence, I am only concerned about minimizing my risk and the validation of my decision through superior performance when I choose to buy your goods and services.

Experienced people mean little to me unless the ”Outcome” of their work is better, faster, and more accurate than that of your competition. How do you measure the “Outcome” of your experienced people that will convince me that it is worth the risk to use your company as a supplier? Dave Nash, President of Engage Marketing, a RI consulting firm, says it best when he states, “You must give me a real reason to believe!” Looking at your business from the customer’s perspective, and listing (modeling) the elements of the ”

“Outcome”, will help you to begin to identify the customer experience, the real product/service that you are delivering.

Five Required Elements for Designing the “Customer Experience”

“If you can’t measure it, you can’t manage it”, and “What gets measured gets done”, are both terms that we have all heard many times. Bringing measurement into the corporate culture is a challenge for any company. By focusing on the company ”Outcome”, management and employees can now concentrate on what the customer is receiving. In total, this represents a company’s product, product offering or value proposition. There are five fundamental elements that must be addressed by any management team before beginning to design a company’s ”Customer Experience”.

1) Management must accept the fact that quantifying the business “Outcome”, or “Customer Experience”, is the cornerstone for building and sustaining an effective market penetration program.

2) Management must passionately and unconditionally embrace the quantification of all elements of the “Outcome”.

3) Management teams must come to grips with the fact that measurement will be met with resistance from many people up and down the organization chart. Management must work through the acceptance process of measuring, and being measured, for both management and the employees.

4) Management must apply measurement evenly throughout the corporation. Rank does not have its privilege, especially for the CEO and senior managers.

5) Management must empower its employees to both help develop the measurement system, and to implement the resulting system. Employee involvement in this process is critical ensure “buy-in” throughout the organization.

The Importance of Employee Involvement

In general, most people resist being measured because its very mention recalls past memories where being measured had negative results for them. Perhaps low test scores in school, or unattained goals in the business community were the reasons. Whatever the cause, in most cases, measurements were used to punish, or take something away, rather than inspire or reward for performance excellence.

The value of the ”Outcome” from any company to its target market is directly proportional to the value added sum of its components. The employees add most of the “value added” components to the “Outcome” because they are the people that interact with your customers on a regular basis. Employees answer the phone, and they get back to customers with answers to most questions like order status and technical issues. They are on the production line running the machines that make our products, etc.

Employees make the “Customer Experience” happen. Most of the communication between a customer and the company is impacted by the performance of these employees. It’s their system to create and drive. It’s management’s role to motivate and empower their employees to do it, and provide them with all the tools and support they need to succeed.

To effectively improve the ”Customer Experience”, the employees must be an integral part of the process. The CEO and senior management add relatively little to the “Customer Experience”. Management just sets the stage for employee performance.

Where do you start? Customer “Touch Points”!

A business associate of mine, Tom Pesaturo, President of Exceeda Consulting, clearly states that, before you march too far along the thought process of establishing the vision for your company, it is important to define the “as is”. The “as is” defines the current performance level for the “Customer Experience”. It’s the “as is” that cements the starting point for a company’s journey to performance excellence. Easy to say, but because most companies measure very little, defining the “as is” in terms of concrete measurements offers up a challenging task.

I suggest that you look at the current state of the company from the standpoint of the customer as the starting point. Conversely, starting this process by defining the internal workings of your company in measurement terms would be a much more complex undertaking and likely to be met with high employee resistance. Looking at the ”Outcome” of the company is more approachable, and not as threatening to management or employees. The ”Outcome” is the summation of all the touch points that represent the totality of the “Customer Experience”. It begins with the initial contact between the customer and the company, usually starting with the first phone call, and is ongoing through every touch point that a customer experiences such as:

a) Initial call into the company

b) On Time Delivery

c) Product quality

d) Response time to questions of any nature … technical, order status, billing status, and the like.

e) In retail or hospitality, anything that impacts the customer’s senses are all considered part of the family of touch points.

f) The quality of all written or oral communication

g) Website and Collateral

(Note: This list could be 20 – 30 elements, or more).

Different types of companies will have varying families of touch points, but the approach is the same.

Once a company makes a comprehensive list of the key elements that make up their customer’s ”Customer Experience”, they can then begin to look at each element, one at a time, with respect to their corporate performance on each. This is the first step for a company to determine the “as is”. True to form, the results of this exercise are usually very revealing, and disappointed to most companies, especially if all these elements are looked at objectively.

Most companies must look at other means to differentiate their products. There are few options. Optimizing the ”Customer Experience” is a great way to do it. Few, if any, of a company’s competitors really focus on this aspect of their businesses in a formal and structured manner. This presents a real opportunity for your company to differentiate your product offering and value proposition in a quantifiable manner.

Once the ”Customer Experience” is outlined, and the appropriate measurements applied to each element, the “as is” will be well defined. This then begs the question … Is the “as is” good enough” to be used as a sales tool to penetrate the market? This is the moment of truth for most companies. Keeping it real, what comes next?

For the initial steps, I suggest you try the following:

1) Break the ”Outcome” down into all the elements that have been identified and look at each one as a stand alone entity. To develop a list, have a 60-minute brainstorming session with your managers and employees and generate a list of customer needs, wants and complaints. You might have 30, or more, items on this list but it will represent a good starting point and a very large percentage of the actual “Outcome”.

2) Rank each element in the order of importance with respect to the ones that you feel are the most important to your customer.

3) Pick one of the key elements, like “on time delivery”, and begin to track and measure the reasons why you are late for each order, or request, over a period of time … say 1-2 months. The important point here is that every order, or request, must be included in the analysis. (Note: You must first establish the criteria for when an order is late, and this criteria must be in line with your customer’s criteria)

Do the same for the other elements of the ”Outcome”. By the way, once you start measuring corporate performance levels, and listing the reason why something was not met, employees will automatically start paying more attention to their role in any specific element of the ”Outcome”. When you think about it, employees control well over 85% of the “Outcome” or “Customer Experience”. As a result, they must be 85% of the solution. It cannot be forced on them by management or push-back is guaranteed. Some elements of the ”Outcome” are more difficult to measure. For example, how does the receptionist answer the phone? One of my clients has given the receptionist the title, Director of First Impressions, and this person was trained in how to deliver “great phone”. It is not measured specifically, but it is addressed.

4) After a period of data collection you will begin to see patterns. For example, one company had issues with the length of time it took for them to get back to a customer with lead times for any order. It could take up to 2 weeks or more. They modeled the process of where the request went and the time that the request stayed in any one location. It was a very simple model. As they collected data they were able to define the key contributor(s) to the delay. Customer Service (CS) collected all the data because they owned the particular customer request.

It was initially explained to all employees the importance of getting back to customers quickly with answers to all their requests as part of the overall ”Customer Experience”. Engineering was the bottleneck in this case and it really stood out. Now responses to lead time requests are well under one week, except for unusual circumstances.

Because this particular example was only a part of an overall program to improve the ”Outcome”, there were many examples where other departments represented the bottle neck. Once a management team begins to model the elements of the “Outcome” in a very graphic manner, it is much easier for all the stakeholders to see the value of their role in optimizing the “Outcome”. Also, with historical measurements applied to each segment of the model, corporate performance and performance improvement becomes more visible.

There is a visual process called “Value Stream Mapping” that has been used very effectively in organizations that have the real passion for continuous improvement.

While some business elements are more complex to model than the example presented, the approach is the same. Eventually, as all the elements are integrated together, you begin to get a visual representation of your business ”Outcome” in real time, or close to real time. I call this the Everest of business modeling because few companies ever have the resolve to follow through on modeling the complete ”Outcome”, with all, or most, its elements. Changing business culture can be a herculean challenge. There are many reasons why it doesn’t get done, but if the CEO has the vision, commitment, humility and passion to see it though, the rewards are great.

The Optimized “Customer Experience”

Real Market Differentiation for market penetration

Step back for a moment and envision that the ”Outcome” for your company has been modeled, measured, and optimized. Your company employees are tuned in to the measurements that frame that “Outcome”, and are using these recorded measurements as one of the tools to help direct their day-to-day behavior. Your sales department is now utilizing the ”Outcome” data as an integral part of their sales presentation. Your company collateral refers to the “Outcome” (“Customer Experience”), using historical data to present your corporate commitment to performance excellence.

The image of your company in the market place is largely derived from the company’s ability to drive the “Customer Experience” to higher levels. Remember, it will be very rare for competition to utilize this same selling technique because few, if any, have brought measurement into their business culture as a vehicle to differentiate their product offering and value proposition. Your company would stand alone in the competitive field, taking the “top of the hill” because of your exceptional service level.

Based on your company’s historically measured performance, in time you will be able to make guarantees that will be the envy of your competition. Your sales team can sell with confidence because they know the performance data is real. They will resist the temptation to oversell because they will not need to.

Self-Sustaining Measurement Culture

As mentioned earlier, bringing measurement into the business culture is a difficult process. Initial resistance from all, or most, employees will be high. That being said, with the resolve of the CEO and senior management, and empowerment of the employees to implement their input, measurement will slowly be embraced by both management and the employees if there is a clear “win” outlined for all involved.

For example, one win for the employees may be a bonus based on the profit/employee number. As the  ”Customer Experience” improves, corporate efficiency will also improve. The “Customer Experience” cannot improve without some proportional improvement in corporate efficiency. As sales from the improved “Customer Experience” increases, it will do so without a proportional increase in the number of employees and, by default, the profit/employee will increase. Again, this represents one win for the employees.

If you accept the fact that modeling and measuring the ”Customer Experience” (The “Outcome”) of your business is a common sense approach to start your corporate change process, congratulations! That is the first step, and you are on your way.

While measuring performance can be very intimidating, measuring the corporate “Outcome” is a much easier concept to embrace as the initial step because real teamwork between corporate functions will be required. The members of the cross-functional teams will work out the processes to optimize the “Outcome”. Solutions will come from the bottom up and, therefore, more sustainable. Also, with this level of employee involvement they feel much more like they are part of the team. This culture is one where their efforts are better recognized. Improved corporate efficiencies has a direct impact the lowering the stress levels among employees.

The CEO must encourage and allow this process to evolve through employee empowerment. You have heard the term “journey” used throughout articles and books written on the subject of change. The Malcolm Baldrige National Quality Award constantly describes the road to performance excellence as a journey. I have had the opportunity to be involved with many journeys and can attest to the fact that it is well worth the ride.

Differentiation, The Customer Experience, EBITDA, and Business Valuation

There are many factors that impact the overall value of a business that a buyer is willing to pay for. Consider the approach outlined above with respect to business valuation:

1)  Optimizing the “Outcome” …. in order for this to happen there must be a corresponding improvement in company efficiency.

2)  Market Penetration … a measured and improved “Outcome” provides the foundation for any Market penetration initiatives, and help establish a corporate brand.

3) Corporate Efficiency … As employees improve corporate overall efficiency and begin to penetrate the market, sales/employee and profit/employee will increase because the improved efficiency will enable employees to do “more with less”.

4) Impact on EBITDA …. improved efficiency, driven by the employees, will result in additional monies dropping the to bottom line. These monies can be allocated to EBITDA, bonuses for employees, and business reinvestment. Regardless of how you slice the pie, EBITDA will be positively impacted.

5) Business Valuation … A strong sustainable business culture, and solid EBITDA performance, will better position your company for a higher business valuation, regardless of the business segment served.

So few companies approach their business in the way described above that, in doing do, your competitive position will be greatly enhanced.

*** END ***

Larry Girouard is the CEO of The Business Avionix Company, established in 2002

Published as a 3 part series in the Woonsocket Call, a Northern Rhode Island newspaper … February, 2010