Employees - The Cornerstone of any Business
Employees drive the goodwill of the business and in the case of a change in ownership represent continuity. One of the most important deciding factors for a buyer would always be: Does the staff know about the sale? Will the manager stay on in the business? How long have your staff been working for you? Taking over a business, the continuity of the staff is the most important factor, especially if the buyer is new to the industry they will be very dependent on your current staff compliment.
30 July 2020
The employees in a company form the cornerstone of almost any industry. We have all heard the old CEO’s cliché – “our employees are our most important asset”
While this has certainly become a cliché, it nonetheless remains true. Your employees are the face of your business, and in the eyes of your clients and the general public, they are perceived to be the business. How often have you thought that you won’t go back to ABC company because they are rude, or “wow I got great service at XYZ enterprises”. In both cases, the company gets the credit or blame, not the staff member or people involved.
Employees drive the goodwill of the business and in the case of a change in ownership represent continuity. One of the most important deciding factors for a buyer would always be:
Does the staff know about the sale? Will the manager stay on in the business? How long have your staff been working for you?
Taking over a business, the continuity of the staff is the most important factor, especially if the buyer is new to the industry they will be very dependent on your current staff compliment.
A few basic guidelines for you, as an owner, and your employees:
- Employment contract:
You should always give your staff a contract. It provides certainty and clarity to both parties. This certainty and clarity will include matters such as working hours, leave days per annum, etc
- Job description:
In most cases, a detailed job description should also be drawn up and agreed upon. A good job description will assign tasks and goals. It should also be achievable and measurable.
The employee can then be measured against that job description. Immediate intervention, or even a reprimand, can take place in the event the staff member is off track. Equally, it is easy to thank and praise staff who are in fact meeting expectations. This helps raise job satisfaction.
- Don’t get too personal:
An employee sells their skills, ability, and time in exchange for money. They are not your friends, and it should be remembered they applied for, and were hired, to perform a task. This does not mean however that you should treat your employees without understanding. Naturally caring and assistance in a non-work context is often a big part of your role as a business owner.
- Training /skills:
I recently saw a very sad but true cartoon: What if we train our employees and they leave? What if we don’t, and they stay? If you don’t provide training or skills enhancement to your staff, the best ones may leave. The weaker ones may stay!! Therefore, training should be regarded as an investment, not a cost.
- Personal issues:
As an employer, you will frequently need to pay attention to the personal issues your staff may have. Typical examples may include staff having challenges with family or children requiring time and attention, family trauma such a divorce or death, or even long term illness. Travel time and the cost thereof are also possible challenges given ever-increasing congestion on our roads and the possibility of long distances to and from work
- When selling:
Remember this will take place subject to Section 197 of the Labour Relations Act. This provides, inter alia,that no staff member may be dismissed when the ownership of a business changes hands. Another important thing to remember is that accurate records and calculations will need to be made regarding any leave pay or bonuses that are due or payable in the hands of the new owner. This calculation is then brought into account when calculating pay for the business.
A good tip:
It is frequently a good idea to ensure that your staff has signed a restraint of trade. This prohibits them from competing with you on leaving the company. It can also cover things like approaching the same client base, using proprietary know-how of the company, etc.
More Sellers Knowledge Bank
Get the latest information, valuable tips and share in the professional knowledge of business experts on selling a business
Whether you’re a new franchisor, or one that has been around a few years, finding the right platform to sell on (when you’re ready to) can be tricky. Many business buyers are opting to buy a franchise rather than a standalone business, because of all the benefits and security of buying a franchise offers. Business for Sale provides an interactive online platform for those looking to buy and sell their businesses. Why would you use a business directory to sell your business? There are a few great reasons!
Selling your business is a serious undertaking, and requires immense preparation and planning. Buyers want to ensure that they are getting the best possible price, while sellers are trying to achieve the same. The process that takes place between the two parties in order to settle on a figure is the negotiation. And there is a definite art to negotiating!
When the market conditions are less than ideal (like now), you’ll probably be reluctant to sell your business. We have already provided useful tips for selling a distressed business, but selling a business in a depressed market is a whole different ballgame. There are many different ways that you can hook a serious buyer who will give you the best price, if you follow some basic best practices.
COVID-19 has had a devastating effect on South African businesses, with many being shut down indefinitely. Even major companies like Ster Kinekor took a huge knock and have had to close their doors, or file for business rescue assistance. Many others are in treacherous waters and have become distressed businesses. But this doesn’t necessarily need to spell D-O-O-M. There are people who are specifically looking to buy distressed businesses. If you are a business in distress, there are tips that you can follow to sell your business, and you can do it conveniently online!
Many businesses get to a stage where they consider expansion, and franchising is one way of expanding a business footprint. There are many benefits to be had from franchising a business, including expansion with third party capital and the dedication of an owner manager that promotes the business for their own profit. Not all businesses have franchise potential. Any business owner considering franchising should ask themselves the following questions. Ideally, all these questions should have a positive answer.
A great ActionCOACH first and foremost has a passion for business, as well as a passion for helping others. All our successful coaches love business. They love the mechanics of business, how it works, finding ways to improve it, fixing broken pieces, breaking unhealthy old ways, learning about different types, creating new ways of doing things, and having fun in the process. For more info contact: Claudell van Eeden, firstname.lastname@example.org
Unlike other businesses, the online venture may not have any tangible assets such as property, machinery, or vehicles instead they will have Intelectual Property, websites, and systems. The company may also have an online presence and income generation as proof of its value. Your business needs to be listed at a realistic market-related price. The correct valuation is thus imperative to ensure that the online business is sold at the right price. Below are four common online business valuation mistakes to avoid.
Though there may be hundreds of businesses being advertised on websites “for sale”, at any given day there are only two types of businesses in the market: Those that don’t sell; and Those that sell.
Access to the number one business broking tool to get your business sold.
We've got you covered!
We offer an innovative and intuitive
solution for selling your business, franchise and premises
your business for sale
the right audience
Latest businesses for sale
View our latest business listings and be the first to enquire