Answering these questions can help you protect, even build company worth
When you look to sell your company one day, any acquirer coming to kick the tires will most likely bring a strong awareness of your market dynamics. These dynamics could impact the purchase price they will be willing to pay you. It’s for this reason that you would be best served to regularly monitor your external market dynamics and have an external situational awareness of how to navigate the findings. Here are good standard questions for monitoring your external situational awareness:
- How big is the market we serve? What are the sub-segments and what is the growth rate of each?
- Where could we be disrupted by an existing or new competitor?
- Is there a part of the market where we could be a disruptor?
- Have our customer’s decision drivers changed? How might they change going forward?
- Are there any changes happening or potentially going to happen to our supply chain?
- Are there technologies currently or potentially going to change our industry and our business?
- What is our competitive landscape? Are we facing new competitors and if so, what changes might they be bringing to our industry?
- Are there or could there be upcoming Legislation changes that could help/hurt our business?
- Will the economy of the markets we serve be an enabler or barrier to achieving our growth targets
- Is investment money flowing in out of our industry from strategic players or private equity or venture capital? Do we know the reasons behind the investment dollars entering or leaving our market?
- What changes are happening or could begin to happen related to attracting and retaining needed labor?
Too often leadership teams only possess an internal situational awareness, what’s going on inside their company four walls But in effective strategic thinking and planning, these are basic questions you’ll want to explore with your team. The answers could provide insights on steps you could take to protect your business and even grow it. Meet with your leadership team and start building the muscle of discussing questions such as these. These are questions you’ll want to regularly have on your radar screen and not just once a year.
