This rapidly-evolving technological environment has changed the game when it comes to business development, with companies growing their brands to multi-million dollar figures almost overnight.
Looking at the lay of the land, we can see that there is a trend where many entrepreneurs are creating businesses to sell to the highest bidder. The odds of this actually happening for black-owned businesses are slimmer than the odds for others, due in part to the relatively small capital base that is accessible to the black business owner. With everyone out here creating apps, products related to Augmented Reality technology and Artificial Intelligence, your business must be cutting edge to attract the buyout that you seek.¬†¬†If you want to create a business that is sellable, here is what you must know.
You must be creative.
It is easy to say that you should think creatively when it comes to your business, but maybe you are not a creative person. Perhaps you are more factual and literal, and that is okay.¬†If you¬†really¬†want to be more¬†creative,¬†then you will have to put in the work,¬†but it doesn’t have to be daunting or feel like a chore.¬†There are many exercises that you can do to foster more creativity in your life and business.¬† A simple online search for creative thinking exercises will yield you many options for ways to get more creativity into your daily life. For example, adult colouring books. Schedule time regularly in your week to work on these exercises to open your imagination.
Working on creative thinking exercises that are not related to your business can help you to think of new and innovative ways to conduct your business and assist with forming connections in your brain to see opportunities to create new products or services to bring to market. In turn, rolling out a new product or service or improving upon a current product or service may get your business on the radar of a larger company who may put forth an offer to purchase your business.
Search for opportunities to merge with other firms.¬†
Mergers can allow a small business to expand their operations and their markets. This means that they have a better chance at increasing their market share and in turn, their revenue. Another advantage of mergers is that black businesses can bid for larger projects as they will have more staff and capacity to take on larger products that generate larger revenues.
‚ÄúHow do I achieve this?‚ÄĚ you ask. You must have a good understanding of your business and the industry in which your business operates. Pay attention to the trends that are happening and see if there are any strategic synergies between your business and another one out there. By this, I mean look for a business that you can help,¬†but that can also help you. For example, a car mechanic partnering with a body shop. Both work on cars but in a different capacity. There may be efficiencies that can be gained in both businesses by merging operations, but it is up to you to do the work and find them. Go out there and seek your opportunities. You don‚Äôt have to only look in your own backyard. The internet has made it easier to do business across borders and continents. Reasons for cross-border partnership opportunities include increased market power, overcoming market entry barriers, finding operational efficiencies, increasing the speed of entry into a market, and greater product or service diversification.
Before embarking on partnering with another business and giving away all your trade secrets, make sure you seek the advice of professionals so that your business is protected. Effective mergers can serve as a platform for growth and provide the foundations required to generate and gain advantages from economies of scale and economies of scope, but things are not always as perfect or smooth as we would like, so you must tread carefully.
Hire top talent.
Getting your idea off the ground may take more expertise than you possess yourself. But hiring top talent takes capital, the ability to sell them on your vision, or a willingness to give up some equity in your company.¬† Partnering with others or offering a percentage of the company in exchange for their work can help to execute that vision you see for yourself and your business. Not to mention, if you are already in business and merge with another company, your capital position may allow you to hire the employees that you need to grow the business to a level where someone wants to acquire it.
As previously stated, it is difficult to create a business that is attractive to buyers,¬†yet the trend of entrepreneurs creating businesses with the goal to sell continues to grow. The reason is because, when it does work, it works well. Look at companies like Travel Noire, Blavity, Carol‚Äôs Daughter, and Attentive.ly who have seen successful mergers and acquisitions over the years. There is power in joining forces with another business and black-owned businesses can see more benefits by working together.
When you start to see an increase in merger and acquisition activity that involves major firms in your industry, these are signs that big changes are about to take place that can affect your business. Even if selling is not your goal, you should anticipate how that activity can affect you and start to put safeguards in place to maintain stability. Having a business plan handy can help you to strategize more effectively and efficiently when it comes to developing contingencies for your business. It is also very important for business owners to anticipate potentially significant changes in the business strategies of their competitors within the industry and react accordingly.
This article written by¬†¬†Chantelle Quow¬† was first published on byblacks.com.