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Why M&A Professionals Should Recommend Low-Code and No-Code Development Platforms

Nathaniel Holzmann of Low Code Road is a member of XPX Nashville
Nathaniel Holzmann
Low Code Road
4 weeks ago

In the fast-paced world of mergers and acquisitions (M&A), professionals are always on the lookout for ways to improve the businesses they represent. The tools and technologies we use can make a big difference, whether we’re aiming for organic growth or preparing a business for sale. Traditionally, business owners have relied on spreadsheets, off-the-shelf software, or Enterprise Resource Planning (ERP) systems. But today, there’s a powerful alternative that’s gaining traction: low-code and no-code development platforms. So, what is low-code development? Low-code development platforms provide a user-friendly way to build applications. Instead of writing complex code, you can create software through simple graphical interfaces and configuration. If you’ve ever used Wordpress to create a website without knowing how to code, you’ll understand the concept. Low-code brings this same simplicity to software development, allowing both business users and developers to create custom applications with minimal coding knowledge. Why are traditional solutions falling short? Spreadsheets: They’re versatile and widely used, but they can become a headache as businesses grow. Spreadsheets are prone to errors, difficult to manage at scale, and lack the robust features needed for complex business processes. Off-the-shelf solutions: While they offer a quick fix for specific needs, these solutions often lack the flexibility to adapt to a business’s unique processes. Customization is limited, and integrating them with other systems can be a challenge. ERP systems: These systems are comprehensive and powerful, but they come with a hefty price tag and lengthy implementation times. Their complexity and cost make them impractical for many small to medium-sized businesses. Here’s why low-code solutions are gaining popularity: Cost-effective: Low-code platforms are generally more affordable than ERP systems, providing robust functionality without the high costs of traditional development and maintenance. Flexibility and customization: Unlike off-the-shelf solutions, low-code platforms let you tailor applications to your specific business needs. This adaptability ensures that the software evolves with your business, supporting growth and changes in processes. Speed of development: Low-code platforms significantly reduce development time. What once took months can now be accomplished in weeks or even days. This speed is crucial for faster adoption and quicker returns on investment. User empowerment: With low-code, business users can actively participate in application development. This reduces reliance on IT departments and accelerates innovation, as those who best understand the business can directly contribute to the development process. Scalability: As businesses grow, their needs change. Low-code platforms are designed to scale, allowing applications to expand and adapt without requiring complete overhauls or replacements. How can businesses use low-code? Process automation: Automating repetitive and manual tasks can save time and reduce errors. Low-code platforms make it easy to automate workflows and processes, improving overall productivity. Custom reporting and analytics: Businesses need actionable insights to make informed decisions. Low-code platforms enable the creation of custom dashboards and reports tailored to your specific requirements. Inventory and supply chain management: For businesses with unique inventory and supply chain needs, low-code platforms can provide customized solutions that enhance visibility and control without the complexity and cost of traditional ERP systems. Let’s look at a real-world example: A mid-sized manufacturing company was looking to optimize its operations before a potential sale. They had been relying on spreadsheets and an outdated off-the-shelf inventory management system. By implementing a low-code platform, they were able to: Streamline inventory management: They built custom applications to track inventory in real-time, reducing stockouts and excess inventory. Improve order processing: Automated workflows sped up order processing, leading to happier customers and fewer errors. Enhance reporting: Tailored dashboards provided management with real-time insights into key performance indicators, supporting better decision-making. The result? A more efficient, agile, and attractive business, ready for growth or acquisition. In conclusion: For M&A professionals, understanding the potential of low-code platforms is a game-changer. These solutions offer a compelling alternative to traditional software options, providing the flexibility, cost-effectiveness, and speed needed to support business growth and transformation. By leveraging low-code, we can help business owners unlock new levels of efficiency and value, ultimately driving better outcomes in the competitive landscape of mergers and acquisitions. As the business world continues to evolve, staying ahead of technological trends is crucial. Low-code platforms represent a transformative opportunity for those willing to embrace their potential. Whether we’re preparing a business for sale or driving operational improvements, low-code is a powerful tool in the modern M&A professional’s toolkit.

Jun 27, 2024
Nashville
Business Value Growth

The Crucial Role of Professional Valuation in Estate Planning

Stacy Deru of 414 Capital is a member of XPX Nashville
Stacy Deru
414 Capital
3 months ago

Accurate Asset Assessment for Fair Distribution: When planning an estate, one of the primary concerns is ensuring a fair and equitable distribution of assets among beneficiaries. A professional valuation provides an accurate and unbiased assessment of the true value of all assets, including real estate, investments, businesses, and personal property. This is essential to avoid disputes among heirs and ensure that your wishes are carried out as intended. Compliance with Tax Regulations: Estate planning often involves navigating complex tax laws. Accurate valuations are crucial for complying with estate and inheritance tax regulations, such as the Internal Revenue Code in the United States. A professional valuation helps in accurately reporting the value of the estate, ensuring compliance, and potentially minimizing tax liabilities. Valuation of Business Interests: For estate holders with business interests, determining the value of these interests is often complicated. Professional valuation firms have the expertise to assess the fair market value of businesses, considering factors like market position, earning potential, and other unique attributes. This is vital for both tax reporting and fair distribution of the business among heirs. Handling Unique or Illiquid Assets: Estate planning can involve unique or illiquid assets, such as art, antiques, or intellectual property. Professional valuation experts have the specialized knowledge to accurately assess these types of assets, ensuring that they are appropriately valued and accounted for in the estate plan. Regular Reassessment for Changing Values: Asset values can fluctuate over time due to market changes, economic conditions, and other factors. Regular reassessment of asset values by a professional is important to keep the estate plan current and reflective of true asset values. This helps in maintaining fairness and accuracy in the estate plan over time.

Apr 12, 2024
Nashville
Business Value Growth

The Power of Marketing: Driving Growth and Maximizing Business Valuation

William McKee of Knowmad Digital Marketing is a member of XPX Charlotte
William L McKee
Knowmad Digital Marketing
4 months ago

In the competitive world of business, marketing plays a pivotal role to drive revenue generation, brand equity, and overall business valuation. Companies that view branding and advertising as a growth strategy are twice as likely to see revenue growth of 5% or more than those that don’t (source: “Read our case study for details. A pilot program is a great way to get started with evaluating how marketing can support the sales process. Be sure to give the program enough time and budget to be effective. In the B2B environment, it often does not take much to recoup the costs of a successful marketing campaign. Getting Started In today’s digital age, businesses that fail to leverage marketing risk being left behind by competitors who effectively tell their story and reach their target audiences. As a trusted advisor, you have the opportunity to guide business owners in recognizing marketing’s potential to drive sustainable growth, profitability, and long-term enterprise value. Knowmad is here to help you design and build a digital marketing program that gets measurable business results. Reach out to William McKee and discover the potential that a data-driven marketing plan can make for your business.

Mar 22, 2024
Charlotte
Business Value Growth

The 5X fallacy, relying on multiples to value a business

Brent Eugenides of BE Financial LLC is a member of XPX Fairfield County
Brent Eugenides
BE Financial LLC
7 months ago

Ever heard of the 5x fallacy?  Hint: It  has to do with business valuation. Using a multiple of X. Try this among your peers, other business owners, and ask your CPA. 1.Ask:  What is a good multiple I should use to estimate the value of my business? You will get all sorts of answers, 5 times EBITDA or 2 times revenue, all sorts of “benchmarks”. 2.Ask people at your industry association. What do they think is a good multiple for a quick estimation of value? 3.Next, assume you were going to buy out a competitor, similar to you in size, and profit. Ask yourself, how much would I spend my own cash for it? Or put another way, if you were to buy a similar business like yours to grow your business thorough an acquisition, to add $ X in added profit, with a reasonable rate of return on your money, what would you be willing to pay for it, in real after tax money? What we see, people are NOT willing to pay anywhere close to as much for another similar business as they think their current business is worth.  Even if the business is a good strategic fit. They want to get a deal, buy at a discount, pay as little as possible. The reason is not greed. Its because you can’t really be sure of “hidden” features in the target business. You don’t know what will “pop up” after you buy it. It’s been private and therefore not transparent. Some people call this the skeletons in the closet. This is why asset sales oftentimes are a protective move for buyers. Don’t buy the business, and assume the unknown liabilities. This can help mitigate some things, but still does not fully cover the risk of buying a private business.  So in reality there is a higher risk premium required with private business transactions and to offset this you need to pay less to cover the risk, or at least to try to offset it if you are buying or investing in a private business. Multiples don’t accurately account for this risk premium. Too vague. Most of the unknowns ( risks)  are because private business is just that, private. The customer base loyalty is not necessarily easily transferable for example. The operations, people, staff, managers, etc. are doing things their way, not necessarily how best to manage a business as a financial investment. There are always inefficiencies in processes and management. The goal is to identify them and have a reliable way to measure the impact of these inefficiencies on the value of the business. It is not always obvious or easy to do. Therefore using or relying on any sort of multiple of revenue, or EBITDA. or other financial metric is NOT anywhere close to giving you any real world idea what a business is worth on the open market, at time of sale or transition.  My suggestion. Don’t ever use multiples ever. It’s not real, it will lead to bad decisions and bad long term personal planning if you are relaying on a liquidity event ( sale of some sort of cash out) to fund your retirement or other financial goal. On the positive side, value growth can be manufactured using a formal process, over time. You can manage and control value build. Do an assessment of your business ( selling or buying it’s the same process), of the operational risks and intrinsic risks to uncover where value gaps exist in the enterprise. Use a dedicated formal process of evaluation with data that is real, and comparable.  Look deeply under the hood at how the business is managed. Do you ( or your purchase business), have things buttoned up, contracts in place with vendors, HR, and documented processes for all operational areas. Good financial reporting that ties profit to each activity is critical as well. Most private business do not do this all that well. There are always gaps and higher risks embedded in most private business. Intrinsic risk is not easy to quantify. Using a formal process to evaluate things in terms other than a financial metric like 5X, or other meaningless ” rules of thumb”.  Value can be manufactured and realized systematically over time.

Dec 20, 2023
Fairfield County
Business Value Growth

10 ways to hurt the value of your company

Xavier Lederer of Ambrose Growth is a member of XPX Hartford
Xavier Lederer
Ambrose Growth
9 months ago

Do you want to get rich quickly? Very simple: Buy a business for its actual value, and sell it back right away for what the business owner values it. Many business owners overvalue their own business (after all, isn’t your business the most beautiful baby in the world?). What do you need to pay attention to in order to make sure that you get the valuation you want when the time is ripe? Looking at your business through the eyes of a buyer Regardless of whether you want to sell your business (or pass it on to your children) in one or in 100 years, looking at your company through the eyes of a buyer can help you identify your top priorities to develop a stronger business – and ultimately get the valuation that you want. Based on experience, readings, and many conversations with experts in the business of buying and selling companies, I have identified 10 key points that can derail your company value. There are obviously many more – I selected these 10 because of their considerable impact on business valuation. The goal of this article is to generate self-reflection through two questions: On a scale from 1 through 10, how is your company performing on each of these 10 points below? Which of these points should be your top priority for improvement? What defines the value of your business? “There are two pieces to valuing a business, says Mark Campbell with 

Oct 23, 2023
Hartford
Member News

Preparing for a Future Exit: Supply Chain and Manufacturing Savings

Steven Lustig of Lustig Global Consulting is a member of XPX Atlanta
Steven Lustig
Lustig Global Consulting
1 year ago

Increasing revenue when preparing for a future sale (or pretty much anytime!) is great but an equivalent savings in operational costs, such as supply chain and manufacturing, can provide an even greater increase in company sales price since valuations are often based on multiples of EBITDA. A $1M increase in sales may improve EBITDA by several hundred thousand dollars while a $1M decrease in supply chain and manufacturing costs usually improves EBITDA by almost that full amount. There are a number of ways to tackle optimizing these costs.  A first step is to look at the current manufacturing and supply chain strategies and how they align with the company’s overall strategy.  Are these areas part of the core competencies that are essential to maintain in-house? Are there other possible operational strategies that are worth considering? With that guidance, companies can then look at their options.  Are they buying the right things from the right suppliers (and the right number of suppliers) at the right time (think inventory levels) at the right prices and on the right terms? Do they have the right mix of what they fabricate, assemble, test, package, and distribute themselves vs. through suppliers? Are the in-house process optimized for best cost, inventory, and quality? Assessing these areas provides great potential for increasing the company’s values.  For more information please go to

Jul 24, 2023
Atlanta
Business Value Growth

A Reminder of What to Look for When Reading a Valuation Report

Martin Abo of Abo and Company, LLC / Abo Cipolla Financial Forensics, LLC is a member of XPX Philadelphia
Martin H Abo
Abo and Company, LLC / Abo Cipolla Financial Forensics, LLC
2 years ago

You approach your attorney, CPA, insurance professional and other financial advisors as you’re in the beginning stages of wanting to sell your company, Tax E, Vader’s No Wax Flooring, Inc. Your advisor(s) recommended a business valuator to get an idea of what the business is worth (perhaps Abo Cipolla Financial Forensics, LLC). Abo delivers the report. Now what? The value appears to be in the ballpark, but what do the report’s details mean? Whatever the reason for a valuation, a basic understanding of the report’s content means there’s no need to take it at face value. Four Points of Interest In today’s fast-paced business environment, it’s not uncommon for business owners to quickly scan a valuation report, searching for the final figure. But you can learn much more from a report if you know what to look for throughout. Here are four key areas within the document we think business owners as well as all of their advisors may wish to at least consider focusing on: Procedures. A business valuator will visit the site as well as perform a detailed financial analysis. Any information the valuator uses should have been available — or at least foreseeable — at the valuation’s “as of” date. Methodology. With various valuation approaches available, valuators choose one based on a company’s unique characteristics. The valuation report, a “conclusion of value” really should discuss all of the valuator’s options, including why some methodologies may be more appropriate than others. Discounts. Once the valuator applies a methodology, he or she determines whether to apply valuation discounts (or premiums) to the preliminary value. Common discounts include the minority interest and marketability. If the valuator applies discounts, he or she should detail why each was chosen, any empirical evidence available and the company’s unique characteristics. Conclusion. After all is said and done, the value conclusion should make economic sense, at least considering both the hypothetical buyer and the hypothetical seller. In addition to these four areas, also look in the “conclusion of value” report for the definition of the entity being valued. This definition should include the valuation’s purpose, the company’s name, the number of shares or interest, the entity type and the “as of” date. Readers of the report should also be on the lookout for what professional “standards” were employed. Business valuators affiliated with a nationally recognized business valuation organization, such as a CVA (Certified Valuation Analyst) from the National Association of Certified Valuators and Analysts (NACVA); an ABV (Accredited in Business Valuation) from the American Institute of CPAs (AICPA); or an Accredited Senior Appraiser from the American Society of Appraisers (ASA) are all required to adhere to industry standards. Standards protect users of valuation services by providing a mechanism with which to regulate us practitioners’ conduct and work quality. Practitioners affiliated with a valuation organization are subject to disciplinary action for non-compliance to standards and could lose their certification for flagrant departures. While no one currently at Abo Cipolla Financial Forensics is an ASA which we understand has very similar standards, we can tell you our ABV and CVA designations dictate we look for guidance to the standards promulgated by the AICPA and NACVA which address all aspects of members’ work product, including: Professional conduct Executing consulting and litigation engagements Performing a business valuation, starting with obtaining the information required to understand the business and scope of the engagement, moving through to the analysis phase which includes the methodology used and other important technical considerations Identifying any scope limitations Reporting the conclusions drawn from the analysis The ABV and CVA were and are not that easy to obtain and require a great deal to so maintain by us and our very credible colleagues.  The ABO? Well, that was a bit easier. Each business is unique and identifying the value of a business is a complex procedure.  Cost, income and market information all must be gathered and analyzed in several different approaches to accurately provide a valuation that will give the owner information needed to improve the financial condition of a business. After a valuation of a business is complete and the results have been analyzed and studied, the owner will often be able to make adjustments to the operational efficiency of the business by simply looking at the numbers and uncovering some of the hidden strengths and weaknesses. Other situations we’ve seen where business valuations are beneficial include: Litigation support, mediation and arbitration (i.e. dissenting shareholders, divorce, economic loss analysis, partner disputes, wrongful death, etc.) Business split-up or spin off Buy sell agreement Bankruptcy and foreclosure Charitable contributions or gifting programs Compensation plan ESOP (Employee Stock Ownership Plan) Estate and gift taxes Financing Incentive stock option program Initial public offering Lease vs. buy option Liquidation or reorganization Pre- or post-nuptial planning Succession planning   The above article was retrieved from the “E-mail alerts” disseminated by Abo and Company, LLC and its affiliate, Abo Cipolla Financial Forensics, LLC, Certified Public Accountants – Litigation and Forensic Accountants to clients and friends of the firm. With offices in Mount Laurel, Morrisville, PA and Franklin Lakes, NJ, tips like the above can also be accessed by going to the firm’s website at www.aboandcompany.com or by calling 856-222-4723.

Feb 1, 2022
Philadelphia
Business Value Growth

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A Dozen Questions to Begin the Exit Planning Discussion

Larry Gard of Hamilton-Chase Consulting is a member of XPX Chicago
Larry Gard
Done With Work Retirement Coaching and Consulting
8 hours ago

As an advisor, your role is to help clients prepare to exit their business, yet many people resist thinking about the future because it involves so many unknowns, decisions, and choices.  And emotions typically complicate matters further, sometimes derailing the process altogether.  Here are some questions that can help you establish rapport with your clients, learn more about their concerns, and move the conversation forward. How are you feeling about your work/profession/business these days? Which aspects of work are you still enjoying, and which are you ready to leave behind? Do you envision retiring from work at some point, or are you contemplating an encore career? What part of planning for your future feels most challenging? How do you imagine your life in retirement will be different from how it is now? What process are you using to figure out what you’ll do next after you retire? What would you like to see happen with your business long term? What options have you considered for the transfer of your business? What steps have you taken to make your business more attractive to a potential buyer? What are your concerns about transitioning your firm to new ownership? What would be your ideal scenario for transitioning out of your company? What topic(s) have we touched on today that we should put on our agenda to revisit? So, what happens after you pose a few of these questions and your clients open up about emotional matters?  Remember, the most helpful thing you can do is to listen attentively.  You’ve created a valuable opportunity for them to talk about things they may not share with other advisors.   Here are some tips for managing the conversation when clients raise emotionally loaded topics: Don’t try to “fix things” by immediately offering suggestions. Doing so sends the message that you’re uncomfortable hearing their concern.  You can offer suggestions but do so later. Don’t say anything that conveys the message that their feeling or concern is unwarranted. “There’s really no need to feel that way” or “I’m sure it will be just fine” may sound reassuring to you but could be experienced as dismissive by your client. Don’t immediately offer a logical counterpoint to your client’s emotion. Remember, feelings don’t have to make sense; they’re “as is”.  Put another way, if feelings made sense, they would be thoughts. People report concerns and characterize their feelings differently from one another, so it’s in your best interest to seek amplification and clarification by inquiring as follows . . . “I want to make sure that I understand exactly what you mean by ___.  Can you tell me more?” “People sometimes mean slightly different things when they talk about ___.  What does ___ mean for you?” “Before I suggest anything, I’d like to learn more about it from your perspective.” It’s possible that during early conversations your client may hint at mixed feelings about exiting their business.  That’s perfectly normal, but you need to bring it out into the open.  You want to foster an atmosphere such that your client keeps you apprised about where they’re at.  If they keep their ambivalence to themselves, it has greater potential to blindside you and complicate the sale.  You can say: “In my experience, it’s normal to have some mixed emotions about selling.  Those thoughts may not always be top of mind, but when they do pop up let’s be sure to talk about them.  Believe it or not, they can help inform our process and alert us to aspects of the sale that are important to you.” You may also find that your client is overly risk averse.  If so, consider saying the following: “Our work together won’t be comprehensive if we only plan for what could go wrong.  That’s just half the equation.  It’s fine to be conservative and err on the side of caution, but to be truly realistic we should also consider a range of possibilities both good and bad.”   Author’s Note:  The concepts in this article are derived from Robert Leahy’s book, Overcoming Resistance in Cognitive Therapy.  New York:  Guilford

Jul 26, 2024
Chicago
Practice Tips

Southern States Fight Back Against Union Wins in South

Robert Brody of Brody and Associates, LLC is a member of XPX Tri-State
Robert G. Brody
Brody and Associates, LLC
1 day ago

For five decades, the southern United States has been an attractive location for automakers to open plants thanks to generous tax breaks and cheaper, non-union labor. However, after decades of failing to unionize automakers in the South, the United Auto Workers dealt a serious blow to that model by winning a landslide union victory at Volkswagen. In an effort to fight back, three southern states have gotten creative: they passed laws barring companies from receiving state grants, loans and tax incentives if the company voluntarily recognizes a union or voluntarily provides unions with employee information. The laws also allow the government to claw back incentive payments after they were made. While these laws are very similar, each law has unique nuances. If you are in an impacted state, you should seek local counsel. In 2023, Tennessee was the first state to pass such a law. This year, Georgia and Alabama followed suit. So why this push? In 2023, the American Legislative Exchange Council (“ALEC”), a nonprofit organization of conservative state legislators and private sector representatives who draft and share model legislation for distribution among state governments, adopted Tennessee’s law as model legislation. In fact, the primary sponsor of Tennessee’s bill was recognized as an ALEC Policy Champion in March 2023. ALEC’s push comes as voluntary recognition of unions gains popularity as an alternative to fighting unions. We recently saw this with the high-profile Ben & Jerry’s voluntary recognition. Will this Southern strategy work to push back against growing union successes? Time will tell. Brody and Associates regularly advises its clients on all labor management issues, including union-related matters, and provides union-free training.  If we can be of assistance in this area, please contact us at info@brodyandassociates.com or 203.454.0560.  

Jul 25, 2024
Tri-State
Business Value Growth

My Interview with Jerry West on Management

John Dini of The Exit Planning Coach is a member of XPX San Antonio
John F Dini
The Exit Planning Coach
2 weeks ago

I once had the thrill of interviewing Jerry West on management. He was “The Logo” for the NBA, although back then they didn’t advertise him as such. Only the Laker followers knew for sure. In 1989 the “Showtime” Lakers were coming off back-to-back championships.  Pat Riley was a year away from his first of three Coach of the Year awards. 

Jul 9, 2024
San Antonio
Owner Life & Legacy

Can You Offer too Many Product Versions to Your Customers?

Steven Lustig of Lustig Global Consulting is a member of XPX Atlanta
Steven Lustig
Lustig Global Consulting
2 weeks ago

Can you Offer Too Many SKUs to Your Customers? The short answer is YES! A SKU, or Stock Keeping Unit, defines each different product version that you sell and keep inventory of.  There may be different SKUs of the same overall item based on size, color, capacity (think computer or cellphone memory), features, and many other parameters.  For build to forecast businesses, that number of variations can quickly explode and become difficult to manage. Your customers are busy and want ordering simplified. Of course, they may need (or want) more than one variation of a product. That is reasonable and a common aspect of business – one size does not fit all! But there is a point where too offering too many SKUs is not value added either for your customer or your business.  In his April 30, 2013 article “Successful Retailers Learn That Fewer Choices Trigger More Sales” in Forbes, Carmine Gallo discusses his experience and a study about “choice overload” by other authors. He writes about a retailer that “has discovered that giving a customer more than three choices at one time actually overwhelms customers and makes them frustrated…when the customer is faced with too many choices at once, it leaves the customer confused and less likely to buy from any of the choices!” Choice overload is well-documented in consumer studies but can apply in B2B as well. While customer satisfaction is important, another key concern is the often-hidden costs associated with a business offering and managing a large number of SKUs for a given product type. These costs include holding inventory, S&OP (Sales and Operations Planning) team time, small production runs, and scrapping inventory. Holding inventory takes up space, which may come with a cost or utilize racks that could be used for other products. Scheduled inventory counts take up employee time and may result in blackout periods when the warehouse is not shipping product.  The more SKUs there are, including extra SKUS, the greater the potential impact. The Sales team’s forecasting and the Operations team’s purchasing reviews that are part of the S&OP process can occupy more of their valuable time if they need to consider these times. If small orders or forecasts require a new production run, this could be costly and create excess inventory. Whether from this new production or past builds, eventually it will make sense to write off and scrap old inventory, another cost impact to the company. How do you know which SKUs to focus on if you wish to look at reducing your total number of SKUs? Start by examining SKUs that have: Low historic sales over a period of time Small variations between SKUs that customers do not value Older technology or model when newer option SKUs are available This requires a true partnership between Sales and Operations. It starts with educating both teams on the costs involved – neither group may be aware of the money and time impact to the company. Periodic (such as quarterly) reviews of SKUs that meet the above descriptions should become a fixed part of the calendar. A review of the data and other available for sale options should result in the identification of SKUs which may not be needed. At that point, it is helpful to have a customer friendly EOL (End of Life) Notice process by which you inform customers of last time buy requirements for this SKU and alternates available. It is usually best to provide some time for the last time buy in the interest of customer satisfaction, although that may not always be necessary. At a company that designed and sold electronics, a robust SKU rationalization process was implemented to help address these issues. A representative from the Operations team analyzed SKUs that met a version of the above criteria and suggested candidates for the EOL process. Next, a member of the Sales team reviewed them and, where appropriate, issued product change or EOL notices to customers, providing them time for last time buy orders when needed. These steps helped reduce the work involved in maintaining these SKUs while not leading to any customer complaints. A final note – sometimes it makes sense to continue offering low selling SKUs – to support customers buying other items (hopefully in larger quantities). It may be worthwhile to encourage them to keep coming back to you for all of their product needs and this may be a way to accomplish that. But it helps to understand that this is truly the case and not assume that this customer would not be equally happy with another, more popular, SKU.   Steven Lustig is founder and CEO of Lustig Global Consulting and an experienced Supply Chain Executive.  He is a recognized thought leader in supply chain and risk mitigation, and serves on the Boards of Directors for Loh Medical and Atlanta Technology Angels.

Jul 9, 2024
Atlanta
Business Value Growth

Owners are a Minority

John Dini of The Exit Planning Coach is a member of XPX San Antonio
John F Dini
The Exit Planning Coach
3 weeks ago

When it comes to careers, business owners are a minority of the population. In conversations this week, I mentioned the statistics several times, and each owner I was discussing it with was surprised that they had so few peers. According to the Small Business Administration (SBA), there are over 33,000,000 businesses in the US. Let’s discount those with zero employees. Many are shell companies or real estate holding entities. Also, those with fewer than 5 employees, true “Mom and Pop” businesses, are hard to distinguish from a job. The North American Industry Classification System (NAICS) Association, lists businesses with 5 to 99 employees at about 3,300,000, and 123,000 have 100 to 500 employees (the SBA’s largest “small business” classification.) Overall, that means about 1% of the country are private employers. Owners are a small minority, a very small minority, of the population. Even if we only count working adults (161,000,000) business owners represent only a little more than 2% of that population. So What? Where am I going with this, and how does it relate to our recent discussions of purpose in business exit planning? It’s an important issue to consider when discussing an owner’s identity after transition. Whether or not individual owners know the statistics of their “rare species” status in society, they instinctively understand that they are different. They are identified with their owner status in every aspect of their business and personal life. At a social event, when asked “What do you do?” they will often respond “I own a business.” It’s an immediate differentiator from describing a job. “I am a carpenter.” or “I work in systems engineering,” describes a function. “I am a business owner” describes a life role. When asked for further information, the owner frequently replies in the Imperial first person plural. “We build multi-family housing,” is never mistaken for a personal role in the company. No one takes that answer to mean that the speaker swings a hammer all day. Owners are a Minority We process much of our information subconsciously. If a man enters a business gathering, for example, and the others in the room are 75% female, he will know instinctively, without consciously counting, that this business meeting or organization is different from others he attends. Similarly, business owners accept their minority status without thinking about it. They expect that the vast majority of the people they meet socially, who attend their church, or who have kids that play sports with theirs, work for someone else. There are places where owners congregate, but otherwise, they don’t expect to meet many other owners in the normal course of daily activity. This can be an issue after they exit the business. You see, telling people “I’m retired” has no distinction. Roughly 98% of the other people who say that never built an organization. They didn’t take the same risks. Others didn’t deal with the same broad variety of issues and challenges. Most didn’t have to personally live with the impact of every daily decision they made, or watch others suffer the consequences of their bad calls. That is why so many former owners suffer from a lack of identity after they leave. Subconsciously, they expect to stand out from the other 98%. “I’m retired” carries no such distinction.       This article was originally published by John F. Dini, CBEC, CExP, CEPA on

Jul 1, 2024
San Antonio
Owner Life & Legacy
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