CFO cum Business Advisory

Divestment – A Good Or Bad Thing?

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Lately I have received a few enquiries from Prospect clients looking for alternate way out of their current “stalemate” in their business venture.

Let me share some tips here …

Rule No. 1 in business is, “Think Big, Walk Small steps”. Keep business sustainable. Eat what you can chew and swallow. Otherwise you will be “choked”.

When all Rules fail, go back to Basic rule : rely on your own Instinct. Move away if you sense “danger”. Cut Costs and even Cut Loss to remain “alive” !

You can either Re-plan and invent New Business Model, then Value your Business forward to get new Investors who believe in you to Rejuvenate your Business, or you Divest totally to cash out.

There is an Art in total Divestment. Do Valuation of your business based on “Story”, “Customer Data base”, “IP”, “Market Share” etc to Increase the PE to increase Business Valuation. Then “clean up” your accounts to plug all possible “gaps” during due diligence by the buyer to maintain your “asking price”.

Once you cash out via Divestment, re-invest in another business model to grow again. This time, make sure you follow rule number 1.

Hope the above helps. 

If you need help, feel free to contact us at :

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www.corporatebackoffice.com.sg

Written by Kelvin Loh