Marketing and Sales are Your Secret Weapons When Selling Your Business
Of the top 7 ways to maximize the value of your business before you sell, Business Development Canada lists increasing profit and sales to be 2 of the most important. And how do you realize that lofty goal? Marketing. Marketing is the silent but powerful force behind increasing profits and sales, and these days, you can do it quite inexpensively. All you need is a plan, focus, and hard work. Marketing leads to sales, and sales lead to profit.
“The best way to boost the value of your business is to show solid performance and profits in recent years.”
So if you’re planning to sell your business, look at brushing off your marketing plan, tweaking it, or even creating one to see where you could boost sales, offer new products or services, or tap into new markets. Give your sales a quick lift with social media and guerilla marketing. But while you’re doing that, remember to also focus on generating recurring revenue as that’s one important point of note buyers will look at to determine if your business is healthy and profitable.
Marketing Holds All the Building Blocks of Both Sustained Revenue Generation and Momentary Sale Surges
So why is marketing so integral to the value of your business? Marketing promotes your product, marketing engages customers and potential customers, and marketing builds relationships. When intertwined, this creates loyalty, and loyalty creates recurring revenue.
“Building recurring revenue streams and shoring up any pending customer or vendor contracts will give buyers comfort that they will have a consistent revenue flow while they get acclimated to the new business.”
~ Bob House, Inc. ~
For that reason, marketing ideally shouldn’t be a Band-Aid to fix your declining sales at the last minute or increase the value of your business just before you sell. It takes time and planning. It’s meant to sustain your business over the long term to engage your customers and nurture your relationships with them. It is the source of your sales, so focus on your marketing plan from day one if possible, and if not, the moment you think about selling. Your buyer will see your marketing plan, customer relationships, and sales as another checkmark in the high-value category.
“…few businesses achieve hyper-growth without marketing.”
~ Eric Samson, Entrepreneur ~
However, you can still use the power of marketing to your benefit if you aren’t in a position to implement that long-term commitment. Marketing can take many forms. While you should focus on increasing subscriptions and contracts for that recurring revenue, you can also take advantage of other methods for a quick surge in sales.
Low-cost guerilla marketing can have an enormous impact when you put a plan in place. Initiate email and direct-mail campaigns, try the power of public relations in local newspapers and use existing customers as centers of influence to gain more customers. When combined with smart social media marketing, as we’ve discussed previously, you can harness the invaluable power of word of mouth.
Think of it this way: the ultimate goal of your business is to make money. How can you make money if no one knows about your product? In the end, marketing equals sales.
“Your competitor is actively marketing its products. Doesn’t this tell you why marketing is important? The only way to gain a competitive advantage over your competition is aggressive marketing.”
~ Hassan Mansoor, CEO, and founder of TechnicalMindsWeb.com ~
And here’s a bonus tip for you to consider: while you’re implementing your marketing plan, think about prioritizing sales yourself, as the owner. Block out and spend one day each week prospecting for new business and hold weekly meetings with your leadership team to discuss how they’re going to bring in new business and what they did to bring in new business last week.
Marketing Has the Added Benefit of Creating a Growth Environment
Remember, marketing your unique brand is critical for sustainability and profitability. As such, you can use your marketing plan to leverage both your product and your brand in current and new markets. Or you can use your marketing plan to spark a new product or service you could offer or a new demographic you could target. This, along with the infamous word of mouth, offers an added sales benefit beyond recurring revenue: growth potential.
While buyers will look at your history during their due diligence, their true interest lies in the future, so knowing the business can grow and profits can continue to increase is a point in your favor that will result in a higher price for your business. Ask yourself these questions and then tailor your marketing strategy to match:
- How can your business get to the next level?
- Are there new products or services in the pipeline?
- Is your business scalable?
- Can you take your business model and roll it into new markets successfully?
- How easy or difficult is it to identify new customers?
- Our products sold to distributors, retailers, or directly to the end-user?
- How often are new products developed and introduced?
- Are they truly new products or just line extensions?
Marketing always results in new customers, new products, and/or new markets. Implemented intelligently and strategically, these openings inevitably lead to business growth and sales growth, hence increased profit.
“An articulated marketing plan is a sign of an organized business and provides a roadmap for a new owner to follow.”
Potential purchasers eyeing your business as a sale candidate will be more likely to buy your company over another and pay top price for it if you can illustrate a realistic growth strategy. Because a marketing plan clearly highlights how and why your business and its cash flow will continue to grow after you leave, buyers will be motivated to choose your business.
The key takeaway here is to not underestimate the power of strategic, systemized marketing to improve your sales, increase your profit, and plant the seeds of future growth. Marketing opens the door to higher recurring revenue by engaging customers and continuing to build on those relationships over time, driving loyalty, repeat business, and word of mouth. It can also result in a short-term bump in your profits.
If you want to command a premium price for your business, focus on marketing as soon as possible, and utilize all the platforms available to you, both short and long term. More importantly, document your plans and strategies, analyze results, and adjust as you go. Having a written marketing plan not only allows you to stay on track and adapt as necessary, but it also gives your potential buyer the opportunity to see the proof of your profitability and future growth potential.
“Remember: The biggest driver of business value is profitability and your ability to prove it.”
~ Business Development Canada ~
And one more thing: BDC recommends business owners hire a professional consultant who specializes in business successions or mergers and acquisitions to help plan your transition, along with other professionals such as accountants and lawyers during the sale of your business. Don’t try and go it alone. Muise Mergers & Acquisitions Inc. can give you the guidance or advice you need. Get in touch today by phone or email: (902) 456.6473 / firstname.lastname@example.org