Business Exit Strategies - part 2

- by Rosemary Ann Ogilvie

Check things like:

Overall appearance and tidiness of premises inside and outside. 'Street appeal' is as important to commercial property as it is to residential property.

• Condition of plant, fittings and office machinery. Is equipment being maintained properly? Is computer hardware and software current? Do you have in place a schedule for systematic replacement of ageing equipment?
• Customer files. Are detailed customer records maintained either on computer or on a hand-written card-file system? Is the information up to date? Is it accessible by all who need it - or does one person, or one department guard it jealously? Worse, is it recorded only in someone's head? Documenting customer information is critical: consider installing CRM or contact management software, and ensure that everyone is trained to use the system.
• Accounting systems. Is your debtors' ledger clean and current? Are invoices raised and send promptly? Do you make it easy for customers to remit promptly? Are effective collection procedures in place to reduce overdues?
• Policies and procedures. Are they all documented? Is that documentation current? Are written procedures updated as processes alter? Is there consistency in the way staff perform tasks?
• Complaint handling. Are documented procedures in place for effective complaint handling? Are they being followed?
• Financial accounts. Clean financial records are fundamental for valuing a business. Even the smallest business should have accounting software and systems that ensure everything is processed on a day-to-day basis so that at any given time, you know exactly how your business is travelling. Large businesses should produce financial accounts on a monthly basis.
• Taxation returns. All taxation matters should be up-to-date. Hollow logs should be cleaned out and any other 'dodgy' practices addressed, with proper procedures followed in future.
• Litigation. What, if any, litigation is pending? Are there any sexual harassment claims that haven't been properly dealt with? Are procedures properly in place for handling this very sensitive area? Are all staff members properly trained in harassment issues? What about workers' compensation claims? Are all staff members trained in occupational health and safety issues?
• Staffing. Ensure people have the equipment and skills they need to do their jobs. Perform a training needs analysis to determine where shortfalls may exist in people's ability to do their jobs. Annual performance reviews are also important, even in the smallest business. Check that employee records are current, with accurate records of entitlements, as well as notes about cautions, warnings, and counselling.
• Inventory. Get rid of any unsaleable stock. Ensure that the warehouse layout meets current requirements, that everything is neat and orderly. Audit physical inventory count against computer records to gauge accuracy of systems and staff. Address problems.

Profit from this frank analysis by making improvements so that each year, your business gains in value in everyone's eyes.