Planning to Grow, Maintain or Divest
Businesses have three basic options: grow, maintain or divest.
Most business people can tell you that static revenues mean you are falling behind. In other words, a decision to maintain is a decision to grow or decline.
Growth requires analysis of markets, customers, internal operations, energy and other resources. Once a business owner has identified exactly what they desire to grow, by how much and why, it can be achieved internally, externally or a combination of both. Internal growth may be easier to control and more cost effective, but it can also take longer to accomplish. External growth may be most costly, but can generate immediate returns.
Divesting also requires some clarification about what to divest and why. Business owners often allow non core elements of their business to influence their decisions. When a segment of a business is discontinued through closure or sale, the proceeds can be used to positively impact the margins and profits of the core, remaining business. Ultimately, the proceeds from a complete divestiture of a business through sale or transfer may represent a significant portion of the owner’s retirement “nest egg” and estate.
We at CAPSTONE believe a frequent and consistent assessment of growth and divesting (and diversification) opportunities is critical in today’s highly competitive and challenging environment. We assist clients with the assessment process, the proper development of strategic plans and specific goals, and the execution of those plans to capitalize on opportunities identified from this process.