TIPS FOR BUYING OUT A COMPETITOR

TIPS FOR BUYING OUT A COMPETITOR.

As the economy begins to recover, many businesses are finding themselves in a rather enviable position: large cash reserves in the bank and weaker competitors just waiting to be snapped up (for a bargain price!). So you know you want to expand by acquiring another firm, but where to start? comp

Analyse Your Business

Start with a good old-fashioned SWOT analysis. Get a flip chart and a marker and, with your management team, write up the Strengths, Weaknesses, Opportunities and Threats of your business. Now identify the gaps; if for example, a weakness is that you have only 3 large clients, you could fill that gap by buying a competitor who has a further 4 large clients, thereby giving you 7 large clients. Repeat this process for the other areas.

Search for a Business

Now that you have your criteria from SWOT analysis, make sure you know how to look for a business. Don’t just go to one source; really check multiple (and reliable) sources to find the business that is right for you. Talk to your team and establish a list of competitors who are considered to have a good client base, good products or services, a good reputation etc. Get the right team of advisors in place (accountants, lawyers, etc.) and draw up a plan.

Value the Business Properly

Your accountant can help you with this, but you should read up and understand the basic financial techniques to value a business; it’s cash flow and other assets. Know how to prepare a basic business plan in order to make projections into the future. You should conduct research in order to understand how the business is getting its customers. Know how it delivers goods and services. You should try to gain an understanding of the cash flow and think about how you can maintain this flow before thinking about increased profitability.

Structure and Finance

Your advisors should be able to give you a basic understanding of how the business valuation and related cash flow tie together. Make sure you examine a number of possible ways to put a transaction together in order to overcome different risks. Your legal team and accountant should provide guidance on the best way to structure the deal and finance it in order to complete the acquisition.

 

ENSURING YOUR STRATEGY WORKS AT ALL LEVELS IN YOUR FIRM

ENSURING YOUR STRATEGY WORKS AT ALL LEVELS IN YOUR FIRM

High-level strategy gives direction to the management team of a business. However, such high level plans can often prove to be of little use to other workers within the organisation. Aspects of the strategy must be distilled down to actions and plans which will drive the various areas of the business towards the common goals outlined in the overall strategy.

strategy

It is often said that a strategy doesn’t fail in its formulation but in its implementation. The key to implementing a strategy successfully is communication.

Many leadership teams, in their excitement and enthusiasm to turn their strategy into reality, fail to take the necessary steps to ensure that it can be delivered effectively by the various departments in the firm. Taking the time and energy to translate your strategic vision into operational success, demands that you focus on the following:

Communication – Your strategic intent and agenda should form the basis of all your communication with the business. When you make and communicate a decision, for example, you should clearly state how it will help move the strategy of the business forward.

Resources – Resources should be allocated on the basis of their ability to deliver the agreed strategy, and not simply reflect historic trends and decisions.

Alignment – The goals of the business must align with the objectives of the departments and people within the firm. Tiny differences of opinion in the boardroom can become huge divisions across the organisation, rapidly reducing your chances of successful implementation.

People – Your best and most appropriate people should be leading the delivery of your key strategic objectives. Not only does this increase the firm’s chances of success, but it also sends a signal to the business about what management considers to be important.

Accountability – The individual performances, and the collective performance of the team, should be directly based on implementing the strategy.

Measurement – Your KPIs should mirror the strategy, as should your associated rewards and bonuses. If you are serious about your strategy you will define appropriate ways to track its delivery and effectively report on progress.

 

ORGANIC GROWTH STRATEGIES

ORGANIC GROWTH STRATEGIES.

Most businesses want to grow, but with less bank finance available these days it’s not easy to just buy out a competitor. If you can’t grow by “mergers and acquisitions”, you need to develop a strategy to grow your business organically which can prove a much slower process.

Organic growth is especially prevalent during the early stages of a company’s commercial establishment, but opportunities continuously present themselves if you listen to the market. So, if your firm is committed to meeting the needs of its customers and is commercially driven with a good control over costs, you can use the following strategies to drive business growth.

ansoff-matrix

Market Penetration

Also known as the “Protect and Build” strategy, this conservative approach sees a company consolidate and stabilise its position in the market by selling more existing products to existing customers. To make this cross-selling approach work, your firm will need to leverage existing resources and capabilities; this will allow your business to capture a larger share of existing markets. This strategy is low risk as you wont need to launch new products or services – instead, just focus on selling more to existing clients and contacts.

 Product Development

A product development strategy focuses on creating new products or services and introducing them to existing customers. If your business is good at creating new innovations then it is probably well positioned to use this strategy. The key is utilising market research in order to identify a need or gap in the market for a new product or service. If there is potential demand and you launch the right product or service, then you stand a reasonable chance of success. There is an element of risk inherent in this strategy, as developing new products requires investment from the business.

Market Development

This approach involves the promotion of existing products into new markets. These could be industry sectors or geographical territories. This approach requires the firm to invest in market research to define which markets are best to target. There is an element of risk to this strategy, as it requires both time and money in order to conduct the research and to develop appropriate marketing campaigns.

 Diversification

This can be a risky growth strategy because to diversify means creating new products or services and selling them into new markets at the same time. There are a lot of “unknown unknowns” involved, such as the competitor landscape and the needs / requirements of customers in that market. There is also risk inherent in the fact that the company is somewhat reliant on the strength of its brand in a market that is not necessarily familiar with. However, diversifying can give the company an opportunity to really grow if the new product / service is well received and the new target market is big enough.

 

MANAGING YOUR INBOX

MANAGING YOUR INBOX

A never-ending inbox of emails is the cause of long working hours, stressed out managers and procrastination. It is also the reason why many people feel that they are so ‘busy’ when in fact they are often busy doing the wrong things. A full, un-manageable inbox can distract you from what you should be doing. Here are a few tips for managing email.

Read Emails in Batches
Identify two time slots in your working day to read and respond to emails. This may not be possible every day, but gain some consistency when you check in to your mails. For the rest of the day focus on getting things done and don’t worry about your inbox. If something is urgent, they can always telephone you. By introducing a bit of structure you will be more productive and will focus on your priorities.

 email-300x300

Switch Off Any Alerts
If you structure your day with ‘email time’ as above, you don’t need to know when you receive a new email. Switch off email alerts on your smartphone or computer. You control your inbox – your inbox can’t be allowed to control you with notifications and flashing red lights!

If you want to receive less emails, send less emails
It sounds obvious, but the reason many people receive lots of emails is because they spend so much time sending them out. Reducing your output will have an impact on how many emails you receive. Try picking up the phone for a change. If you have a team or colleagues, get up from your desk and walk over to talk to them. You may achieve a lot more simply by having a conversation with the right person.

Use your ‘Out of Office’
Manage expectations. When you are on holiday, you probably use an ‘Out of Office’ response to tell people you are away. When you come back you are then faced with a mountain of emails and may feel overwhelmed. Next time you are away, leave your out of office on for an extra day or two after you get back to allow you to catch up on emails that came in while you were away

EFFECTIVE DELEGATION

EFFECTIVE DELEGATION.

We all understand the importance of delegation, yet very few know how to do it properly. Here are a few tips to help you delegate work effectively.

delegation

Realistic Deadlines

It is important to note that overloading your team will have a negative impact, so before you delegate work make sure that you understand how much work they currently have to do. Next identify any extra capacity in your team and consider whether this is enough to complete a delegated task or project. Set a deadline that is realistic and achievable for the person or team to whom you are delegating the work.

Be Specific about What You Want Done

Be clear as to the purpose of the delegated work and what kind of results you expect. Providing a written outline of what you require can be useful, as this gives your team something to refer back to. Finally, take the time to answer your team’s questions – this takes less time than redoing the work!

Leave Them to It

Once you have delegated work to someone who is well equipped to handle the task, allow them to be imaginative in their approach and do something in a differently or better way. How they do the work doesn’t really matter, as long as it produces the right results.  Remember – nobody likes to be micro managed.

Develop Your Team

You can use delegation to empower team members and encourage them to develop new skills and expertise. Make sure that they feel comfortable to ask questions: let them know that you are happy to clarify anything they may be unsure about.

Reporting

Have a system in place so that your team can report their progress without having to constantly interrupt you during the day. Setting dates for progress updates can be useful.

 

 

CORPORATE SOCIAL RESPONSIBILITY (CSR) AS A PROFILE RAISING TOOL

CORPORATE SOCIAL RESPONSIBILITY (CSR) AS A PROFILE RAISING TOOL.

Whether establishing a business-charity partnership or organising for a group of staff to volunteer in the local community, CSR is part of being in business. CSR is a great way to engage your staff, build teams and fulfil your business’s role as a responsible part of the wider community. Large businesses often run substantial CSR programmes but small firms can contribute by engaging with local charity events. Charity isn’t an obvious profile raising tool for businesses but it can be a great way of increasing your profile in the market while conveying a positive image as a good corporate citizen.

A NEW WAY
A NEW WAY

Think Local
If you are a local business, your customers will want to see you supporting the local area. Charitable organisations are often funded purely through donations. What’s more, they often need help with more than just finance. A nice way to support such charities is to allow your staff to volunteer some time (say 1 or 2 days per year) during work to help out with the charity’s activities. Alternatively, if some of your team are sporty, they could run a marathon to raise money. They could write about their experience in the local newspaper or a relevant business journal, giving give the business and the charity some good PR off the back of the event.

Stick with what you are good at
If you want to build the profile of your business in a particular sector, you could try to support a relevant charity which you would like your business to be associated with. For example, if you offer accounting and taxation services to the social housing sector, then you could help out a social housing charity as part of your CSR programme. This would help to raise the profile of your firm in this market, while at the same time giving your business and your people the opportunity to engage in CSR.

Go with what you believe in
You may think that there is nothing you can do to help, but if there is a particular charity that you believe in then contact them. If you are passionate and enthusiastic about the chosen charity your firm supports, this will come across when you talk about it. It will make good reading in the local newspaper while generating some PR for your firm at the same time.

5 BEST PRACTICES’ FOR USING EMAIL

Email is part of day to day business life in most businesses. Here are a few tips to help you regain control of your inbox.

Speak to peopleSpeakPeople

When you receive an email that looks like it’s going to be complicated to reply to, visit/telephone the person who sent it, and ask what they want you to do. Discussing things in person can eliminate those email chains that go on and on. People can often hide behind email but in person, you can make your point and, if necessary, demand a straight answer.

Send good emails

We all get junk emails on a regular basis. If you send good quality emails you will tend to receive quality emails back. Try to be straight with people and don’t hide behind elusive language. Tackle problems head on and in a polite manner. This will make it more difficult for people to respond in a rude or annoying way.

Avoid “reply all”

This just clutters up people’s inboxes unnecessarily. They will also reply all back to you and clutter up your inbox. Only reply to those to whom it is necessary to reply.

Lengthy emails

If you receive a lengthy email and you are too busy to deal with it, reply to or call the sender. Try something along the lines of “Thanks for this.  I’m short on time.  Very quickly, what is it you would like me to do?”

Agreements    

Very often we send emails in order to get things agreed in writing. If you need this, perhaps try having a conversation with the person. Establish the way forward, agree verbally then when you get back to your desk send an email to confirm what has been agreed along the lines of, “As discussed today, we have confirmed our agreement to….” Don’t forget to file this email – it can be useful if the decision is ever challenged.

MANAGING DIFFICULT EMPLOYEES

MANAGING DIFFICULT EMPLOYEES.

Effectively managing difficult employees can be a challenging prospect. Whether it is the employee who is consistently late, who complains incessantly or who seems to constantly upset their co-workers, every company must deal with difficult employees.

difficult emplyees

These situations drain management’s time and energy, impact on the morale of co-workers and interfere with overall workplace productivity. The key to effectively addressing such situations begins with an understanding of the issues and a clear identification of the actual source of the problem.

Even the best employee can have an off-day (or week, or month). Before deciding if an employee is difficult, managers must first step back and neutrally assess the situation. The first question to ask is whether the behaviour is critical enough to implement a formal HR process. Another important concept to consider is that ‘different’ does not equal ‘difficult’. There will always be employees that a manager does not gel with, understand or even like. However, this is not enough to deem an employee difficult. To constitute a “difficult employee”, behaviour must exceed acceptable standards, policies and procedures or interfere with productivity.

Define the Problem

When addressing the problems created by difficult employees, the focus should always be on job performance. It is management’s duty to clearly explain why the issue is a problem, and how the problem is adversely impacting the company. At this stage it may be useful to refer to the employee’s job description and the company handbook.

Clarify Roles

It is important that both the manager and employee are absolutely clear on individual roles. The manager’s role is to ensure business success by leading, coaching and supporting employees. The employee’s role is to meet predefined performance and behaviour standards, and function as a cooperative team member. A key concept that employees must grasp is that it is not only the level of their performance that is important, but also how their performance affects the functioning of their team, department and the company overall.

Identify Expectations

This is where the manager should clarify four things – the employee’s performance, responsibilities, impact of their behaviour and the consequences if it doesn’t change. A follow up and ongoing review should be scheduled and regular updates between the manager and the employee will help to move things forward and get the employee back on track.

 

GET MORE OUT OF YOUR MEETINGS

GET MORE OUT OF YOUR MEETINGS.

 Meetings are a necessary evil. However, they are time consuming, resource intensive and can often prove to be inefficient if attendees are not prepared. Here are some top tips to help you to make the most of your meetings.

AGENDA

 

Create an Agenda

Agree an agenda for each meeting and circulate the agenda prior to the meeting. This sets the tone for your meeting and avoids situations where people get side tracked.

Punctuality

Timing is important. If people don’t show up on time, start without them. They will learn by experience and they will avoid being late for the next meeting. Equally, stick to your timeline – if you say a meeting will be over by 4pm then make sure it is over on time as your colleagues will have other things which the need to attend to during their working day.

Be Prepared

Set a good example by being prepared for meetings. As others observe that you are prepared, they will tend to follow your example as it comes across as professional. Being prepared for meetings will also help you to win the respect of your colleagues as they may view people who turn up to meetings unprepared as “time wasters”.

No Blackberries or Mobile Phones

At the start of each meeting ask colleagues to switch their phones to silent and avoid checking emails during the meeting. If you make a point of saying this, they will most likely avoid being distracted by their phones and will contribute more to the meeting as a result.

Facilitate

If you are chairing a meeting, aim to facilitate conversation between colleagues. Do not allow a small minority to dominate the meeting. Very often, knowledgeable people fail to contribute to a meeting as they are overwhelmed by more talkative colleagues.

KNOW YOUR COMPETITORS

KNOW YOUR COMPETITORS. competitors

 Businesses need to know their competition, especially in today’s hyper-competitive business environment. Knowing what the competition is up to allows you to develop unique selling points (USPs) which will encourage buyers to purchase from you.

People

In order to understand the customer experience offered by your competitors, try “mystery shopping” your nearest direct competitors. Things to note include: the customer experience, staff-customer interaction, how staff dress and present themselves, the business environment and little touches such as complementary tea or coffee. Most important of all is to take note of the sales process – how do your competitors go about selling products or services to the customer? Do they suggest how their product or service can add value? Do they offer a demonstration? How do they close the sale?

Products and Services

Keep an eye out for any new services or products your competitors offer. Pay close attention to the quality of their brochures, the appearance of their products and any new or interesting ways in which they add value for their customers. You should create reports which compare your business to the leading competitors in your particular sector of the market. You should circulate these reports to your management and sales teams with a view to encouraging them to implement new ideas and approaches which will improve your business against your competitors.

Pricing

Once you know the specific details about your competitor’s people and their products or services, your sales team will be more informed and can develop the USPs that they can use when challenged by customers as to “why should I buy from you and not from your competitor?”. Your sales team can then focus on the strengths of your products or services and encourage your customers to do the same.

If you are at a disadvantage to your competitors in terms of your pricing, work with your sales team to prepare a checklist of the specific features and benefits unique to your product or service. Have each sales person practice presenting this checklist, as this particular part of the sales process will usually be enough for the prospect to decide to purchase from you.