Your Business and the Business Life Cycle
Your business goes through several life cycle stages, and different financial strategies are appropriate at each or the four distinct states
Firstly please consider the following three steps when reading this document.
Use the Business Life Cycle Stages to identify your company's current position in the business life cycle.
Use the Business Life Cycle Checklist to better understand the issues that you'll be dealing with in each phase.
Use the appropriate Leadership strategies shown in the attached file, to deal with the issues applicable to the Business Life Cycle phase (as necessary)
Business Life Cycle Stages
The business is developing initial products, defining markets, and deciding what business structure to use and creating its first operational systems.
Sales are growing, more employees are needed, operational systems will soon be outgrown and increased revenues are bringing tax issues to the forefront.
Growth has brought cash reserves that require investment decision, operational systems need to be further refined and the importance of keeping key employees increases.
It's time to decide whether to keep the business in the family, diversity investment away from the business, sell or transfer the business or go in a new direction, and revitalize or rebuild.
Business Life Cycle Issues
- Preparing business plan/improving results
- Improving/ managing cash flow
- Accumulating funds for specific business needs
- Selecting entity structure.
- Protecting investment in business
- Protecting against business risks
- Managing business taxes
- Implementing retirement plans
- Establishing programs to attract and retain employees.
- Investing business cash reserves
- Getting business valuation
- Structuring benefits for owners
- Protecting against impact of loss of key employees.
- Create buy/sell agreement
- Implementing a business transition plan
- Retaining business within the family
- Selling at desired price
- Finding next venture.
Please refer to the attached Image for appropriate leadership strategies aligned to your business life cycle stage.