For those wanting to sell their company one day, think about your company Shut The Door Metric. Here is a great template to faciliate dialog with your team - (Shut The Door Metric Template)
Ask yourself this question - if today you announced to your customers that your business is closing its doors and no longer available to accept new business, how many minutes, hours, days, weeks, months or years would it take them to find a replacement for what they have been purchasing from you?
How to use our template - start by developing your scoring model using the example table provided on the left side of the graphic. Identify what criteria you would use with your business using our example for ideas. Setting this score criteria will help you think about what aspects of your business afford you the ability to be very important to your customers and/or show that they are reliant on you. Then identify the customers, or customer groups or segments, you'd like to plot. The bubble size reflects the magnitude or revenue for your company from this customer/group and is plotted based on the vertical axis. Then think about each customer, or group/segment, and assign each a Shut The Door metric score using the scoring system you established and plot on the horizontal axis based on having a low metric of "1 to 5" or a high metric of "5 to 10". Once you plot your customers, use the graphic to faciliate great internal dialog in terms of how your team can protect those you have a high metric with today and steps you can take to build it with those you don't.
Having a meaningful number of customers, or groups of customers, with high Shut The Door metric scoring greatly helps build the value of your company. The reason your company value increases is because a higher Shut The Door metric means your customers are reliant on you and this is a good predictor of future revenue and acquirer's of businesses love having visibility to future revenue growth.
Give us a call if you want help customzing this enabling strategic template for your business!