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Protect Your Brands
While some may question Chrysler's brand value, no one can seriously question Jeep's value. Jeep was very close to the Marlboro Man in American mystique. Yet Daimler let Hummer take Jeeps prized position as the "American Badlands 4 Wheel Drive Experience." Daimler, in 2007, finally brought out a Hummer competitor - right in time for a spike in gas prices. Always protect your brands and the value inherent in them.
Chrysler invented the minivan. Chrysler still has some very nice minivans. Yet in the day of the "crossover" or mix of SUV and minivan, where is Chrysler's entry? What happened to the design studio again?
Keep Your Talent, They Are Your Business
In the name of efficiency Daimler didn't let Chrysler keep dancing the dance that got it to the ball. In a merger originally billed as a marriage of equals it very quickly became clear that the superior equal was Daimler. After all, they were the purchaser. But why chase off the talent you paid dearly for? Always keep your key people on the team if you want to maximize your sales or merger value even if you must share some of the rewards with them. Based on Chrysler's revival from death in the 1990's, someone there clearly knew what they were doing. It is a fatal mistake to lose your best people, or worse yet, force them to turn to your competitors.
Final Thoughts On Business Value
With the advantages of hindsight, it is clear that Daimler has made about every mistake possible thereby destroying the value of the Chrysler subsidiary. Chrysler lost profitability because it stopped being Chrysler. Chrysler lost its affordable style position when it lost its design edge and design speed. It lost much of the value in its key Jeep brand by not staying up with changing trends. These and many other mistakes took Chrysler from record profits to huge losses. Daimler bought in an up market cycle and sold in a down cycle. As a final insult, Daimler did not even allow a reasonable time on the market for the transaction to be negotiated. Avoid making these mistakes when looking to sell or merge your private business.
In order to earn the greatest return when you sell or merge your business, make sure your profits are increasing, you are running with the business cycle and you follow a proper merger and sales process.
(c) 2007, Gregory Caruso.
About The Author Gregory Caruso, CPA, Attorney, and Certified Valuation Analyst, is a Gregory Caruso, CPA, Attorney, and Certified Valuation Analyst, is a Principal at Harvest Associates in Baltimore and Bethesda, Maryland. He is the author of the book 11 Secrets to Selling Your Business and an expert in privately held business mergers and acquisitions with over 20 years of experience. To obtain a free initial consultation, arrange a speaking engagement, or order the book, contact Greg at 877-838-4966,
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or http://www.harvestbusiness.com/
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