Are You an R.I.P. Business Owner?
R.I. P. conjures images of zombies, ghosts, and dread. R.I.P. businesses are not that far from these same images. But, in this case, R.I.P. means Retired In Place. Retired In Place (R.I.P.) businesses are businesses that lack vigor, imagination, growth, and life. They maintain the status quo, year after year, with little change. These businesses become victims of the market - as technology changes the way services are performed, these businesses stagnate. As clients demand more innovative services, these businesses offer nothing new. As government tightens regulations, these businesses fail to adapt. From my perspective, R.I.P. businesses have 3 strategic choices - 1. Do Nothing, 2. Adapt, or 3. Sell.
1. Doing Nothing can lead to obsolescence. The business becomes irrelevant in the eyes of the consumer. This leads to eventually closing operations in failure.
2. Adapt requires a change in thinking about what the business is and making strategic investments in people, processes, and production. It is the long-term play.
3. Sell means cashing out now before more Enterprise Value is lost.
On review, Doing Nothing is not a good choice. Most businesses owners have invested their life's savings in their businesses. And the business represents the nest egg for one's retirement. So, the realistic choices are Adapt (which requires investment) or Sell (which means cashing out and harvesting your past investments). What works best for you? Some have the financial resources and time to Adapt. Many do not. For those who do not, Sell may be the better option. If you think that the Sell option may work for you, learn more. Remember, few owners sell their business too early, but many, unfortunately, sell their businesses too late.