Selling a business is rarely simple. There are half a dozen preparatory tasks involved for even the smallest venture, like improving your analytics and rewriting your sales pitch till you get it exactly right. Business analytics is just one more tool in your exit strategy, helping you to elevate your standing before a sale.
Business analytics is incredibly powerful for generating better business decisions. By using it, you can assess your exit situation, model various options, and even uncover lucrative alternatives.
But what exactly gives business analytics these abilities? And how can you use them in your exit strategy?
As you explore the answers to these questions, consider all the various applications for business analytics in your own ventures. More lucrative deals await.
The Power of Business Analytics
Business analytics is all about leveraging facts to produce better businesses. It achieves this through the harnessing of both structured and unstructured data into informative patterns. From here, businesses can apply the data into actionable strategies.
Analytics is conducted and applied through a series of methods that don’t vary much, no matter the industry. These methods are:
- Identifying research questions
- Gathering the data
- Analyzing the data through various frameworks
- Communicating insights from the data
- Turning insights into action strategies
This is the guiding process for the use of all business data. It helps you assess how the metrics you track can be used to inform better strategies, allows you to determine a descriptive or prescriptive approach, and leaves you with the tools you need to communicate and act on all your data.
These features are why business analytics is proving to be a long-term growth sector. Every business wants the power of data-driven decision-making, and only business analytics can accurately provide that.
Business analytics is especially valuable when building your exit strategy. From evaluating your company’s potential worth to securing a lucrative deal, analytics gives you everything you need to maximize the potential of a sale.
But how do you use it?
How to Use Business Analytics in Your Exit Strategy
Business analytics is a highly complicated tool. After all, it is typically supplemented by artificial intelligence algorithms and powerful software that might be overwhelming to those with limited technical experience. However, you can easily and accurately apply business analytics to the evaluation and completion of your business sale by following the right methods.
Here are five ways you can use business analytics in your exit strategy effectively:
1. Collect all your info in one place.
This is the best place to start when evaluating a business for a sale. You want one comprehensive dashboard for assessing your company details and determining the best approach from there. Business analytics platforms were built for exactly this purpose, and finding the right tool for you will make the process simple.
Once you have all your information in one place, you’re ready to ask the most important research questions in exiting your business, questions like: what is my business worth? What do I want from a buyer? Or, what are the tax consequences from selling as is?
2. Determine your business’s worth.
With all your data in hand, you can apply business analytics in determining the true value of your business now as well as its potential value over time.
For instance, it might seem like the best idea to sell now and downsize in preparation of building an at-home business. Analytics allows you to evaluate such a decision by comparatively assessing business plans, tax deductions, licensing costs, and more.
With the right data, you can measure the revenue from your business sale versus what you might obtain from keeping it. That insight adds immeasurable value to any sale.
3. Build a unified buyer persona.
Next, analytics will help you uncover the details surrounding market activity for a business like yours and understand who might be willing to buy. This information is instrumental in making the most of any deal.
You’ll especially need business analytics if you hope to make the most of a multi-channel listing environment. Different platforms cater to different audiences. However, you’ll need to assemble a unified buyer persona if you want to be successful anywhere.
This means collating your data across channels to create a composite image of who your target buyer is. What is their profession? What is their budget? What might their goals be? Business analytics helps you find these answers.
4. Turn your analytics into a narrative.
Communicating data-driven insights, however, can sometimes be harder than generating the insights through analytics. It is the job of every analyst to be able to communicate the information you find in a way that your target audience will find compelling. In this case, the audience is your potential buyer.
Related: How to Prepare a Communication Plan When Selling a Business
Use your unified buyer persona to fill in gaps in the data as you structure all your info into a narrative. As humans, we love stories. They give us understanding and empathy, allowing us to see through the eyes of prospective buyers.
Turn your analytics into a compelling narrative, and you’ll have more success in marketing your business.
At the end of the sales process, just before you finalize the deal, you should apply business analytics once again. You can evaluate market data in your industry to compare and assess net value, location, business size, and asset worth. Your deal should make financial sense not just for you but in terms of current market performance. If something seems off, it’s time to reevaluate.
The best business analytics strategies improve over time because they are assisted by AI machine learning functions that learn with more data. Therefore, the more you reassess your data, the more the software learns.
Through these applications of business analytics, you can evolve your exit strategy. This means cutting down on marketing costs, getting a higher buyout/asking price, and ensuring your long-term financial well-being. But it will take expertise to get it right.
Consider taking on a business analytics professional if you do not already have one on your team. Alternatively, you might train up some of your staff or seek out analytics training yourself. Regardless, you must build your understanding of business analytics as you begin evaluating your exit strategy.
Using Analytics to Evaluate Your Exit
With the right tools and professional help, business analytics can transform an exit strategy for the better. But first, you have to understand how business analytics helps and how it can be applied towards actionable improvements in the sales process.
Through consistent methodology, business analytics offers invaluable knowledge of market conditions. Apply it through software use, business valuation, buyer profiling, and narrative formation. From there, you can reevaluate when the time comes to make the best possible business deal.