Every so often you’ll see a story on the news about someone who made a fortune off of some toy collection from their childhood or by selling a random antique they found at a yard sale. We even have numerous TV shows dedicated to the discovery and sale of tangible assets, especially items that seemed like nothing more than junk to the owner.
Shows like Pawn Stars and Antiques Roadshow keep the dream alive of becoming immensely wealthy by collecting and preserving everyday items that may someday drastically increase in value and provide an outrageously high ROI. They have fed into an already massive “Cult of Collection” whose ranks are filled out by garage sale hoppers, flea market bargain hunters, and abandoned storage unit scourers who are hoping to strike it rich.
Unfortunately, shows like these have likely inspired many more hoarders than they have millionaires. Nonetheless, many of you reading this at some point probably started a collection of mint condition comic books or baseball cards or Beanie Babies or Star Wars figurines in hopes that someday they would appreciate in value. Maybe you even hermetically sealed them and stashed them away in a dark closet or storage unit to ensure they were properly preserved. And if you have the time and patience and discipline to be a true collector, perhaps that investment will pay off…someday.
But the truth is, you have very little to no control over whether or not these assets will ever appreciate in value, and it’s a lot more fun to take them out of the box and play with them.
One asset that does afford you immense control over its value? Your business.
Unlike comic books or baseball cards, there are many steps you can take to increase the potential sale value of your business, and you won’t even have to hide it in a closet.
Start by working to transform your business from a work-in-progress to a turnkey enterprise. Most potential buyers will not want to have to put a lot of time or effort into building and growing your business once they take over. They will want to be able to step in and do as little as possible to profit from the purchase. To achieve turnkey status, you will want to focus on systematizing and simplifying your company’s processes while ensuring you have employees in place who can help ensure any transition to a new owner will be as seamless as possible.
And it should go without saying that working to increase your company’s profitability will also help to improve its value. And remember, a recurring form of revenue is generally going to be much more valuable from a business valuation standpoint than that of a one-time sale.
If you’re the type who is hoping to make a fortune off of his or her comic book collection, we wish you the very best of luck. But if you’re the type who wants to take control of your future by learning more about business exit planning and discovering strategies to help you boost the potential sale value of your company, please call the attorneys at Brown & Sterling today.
