Pro Tip: Risk Management

A topic we often discuss with clients is business risk. What sort of risks create value degradation in a business? Here are a few:

1. Too much dependency on the Owner. If the Owner leaves, the business becomes less valuable. 

2. Lack of customer diversity. When a few large customers are representing the large majority of revenue for a business, this risk of loss with one of them is too great and lowers value.

3. Lack of visibility around cash conversion. Businesses can be profitable without good cash flow and buyers want proof cash conversion is favorable.

We can help you get clarity with these!