3 Common Mistakes Business Owners Make That Devalue Their Business

As a business owner, you have your eyes on many balls at one time. You are running the business, but you are also likely doing some sales, managing your employees, maybe doing bookkeeping or even the cleaning. On a daily basis you are putting out fires and still trying to be strategic about your business.

It is not easy to do it all, as you know. This why so many business owners forget that their number one job is to run and grow the business. This is a task that only they can do and so they must make time for this critical and import task.

Often, because owners forget to make time for this takes, they make common mistakes that over a long period of time devalues the business. Here are the 3 most common mistakes.

1. Not having a plan. By far this is the most common mistake. It is the business owner that is too busy to run their business. They jump from one fire to another letting the business run them. Often they wake up one day and realize they are burned out and want to leave the business. Never realizing they never really took control of the business and built it for success.

2. Not detailing the plan with specifics. If a business owner does have a plan, then the second most common mistake is not making the plan detailed enough. For example, the plan might be to grow the business by 10%, but the plan will lack a strategy to do that. It is almost like because the owner said it will happen, so it will happen with no really strategy for it. This rarely works. The more detailed the plan with specifics the likely you will achieve the goal.

3. Not following the plan. If the plan is detailed and specific, then the next common mistake is not sticking to the plan. It is common to have a plan, but then following it is a step that often gets missed.

Without having a detailed plan and following the plan, you are drastically devaluing your business.

A small business owner was a devastated to learn her business was only worth the value of its equipment because she had minimized the tax liability and it was showing no profit. If she had met with an exit planning professional years earlier should would have had a detailed plan to maximize the value of her business and instead of selling for $35,000 she might be selling for $350,000.

Because many business owners don’t think about their exit strategy, they often devalue their own business by the way they run it.