• Tamara Morgan

A Business Owner's Report Card

How does someone else, for example, a potential buyer, rate your business on the issues listed below?  Rate your business and yourself on the time-honored “A” to “F” scale.  You can even use a plus or minus.  What’s your average? Too many business owners operate on gut feel or “from the heart.”  Nothing wrong with that; many people start or buy their own business and operate it successfully with nothing more tangible than this kind of factor. But, every now and then, perhaps once a year, seize the moment and take a more realistic look at your business. 


Grade yourself, using the following business report card as yardstick:


1.    Difficulty or the lack of competitive entry 2.    Stature of the business or product . . . exciting/glamorous 3.    Perceived level of required expertise – or licensing 4.    Ability of the business to secure funding — seller carry-back 5.    Volatility of business/customer loyalty 6.    Diversity of customers and/or suppliers. Exclusives? 7.    Length of business – history 8.    Reliability or fuzziness of financial records 9.    Key-man syndrome 10.    Severity of business seasonality 11.    The people factor 12.    Hours of operation 13.    Hazardous work, work place, products, or neighborhoods 14.    Bad lease – no lease 15.    Owner to stay 16.    Trend or erratic numbers –non recurring 17.    Goodwill (Blue Sky) as percentage of price 18.    Sparkling physical appearance or needing upgrade 19.    Regular or home office 20.    Remote location 21.    Contemporary and ship-shape equipment 22.    Franchised or Independent 23.    Visible expansion opportunity 24.    Loyal key employees in place 25.    Broker involved with deal 26.    Potential 27.    Name and reputation

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