Business Restrooms as an Indicator of Company Worth

Below is a summary of an article I found on the internet recently.

Is this business well run? Check the restrooms first

February 18, 2012 12:00 am  •  By Michael G. Goldsby – Executive Director of the Entrepreneurship Center and the Stoops distinguished professor of entrepreneurship at Ball State University.

Advice from Leland Boren, an 87-year-old force of nature who has seen it all in nearly seven decades in business. He is the CEO of Avis International Corp. He also owns 23 businesses and has built, bought and sold many others during a 67 year career. When it comes to examining a potential target for acquisition, he advises to:

  • First, examine the company’s history with cash. Accounts receivables and payables are good indicators of cash management.
  • Second, he looks at their product line and considers whether improvements can be made to them.
  • Third, analyze if there is the potential to expand the product line.
  • Fourth, remove any intangibles and goodwill out of the company valuation, allowing for negotiation and management based on the true performance of the company.
  • Fifth, examines the company’s sales team performance to determine whether it is performing as well as it can.

But there’s another little secret:

If you really want to see a good indicator of how a company is run, go into the restrooms. It will tell a lot about a company’s attention to detail. If the restrooms are not clean, it might be a good sign that new management is needed in the company.

Source: http://www.nwitimes.com/news/opinion/guest-commentary/guest-commentary-is-this-business-well-run-check-the-restrooms/article_525fca25-982a-5bdb-b064-277d091ee6b2.html

Leave a Reply

Your email address will not be published. Required fields are marked *