FAQ’s

We go to great lengths to safeguard the confidentiality of our clients.  We have a tried and tested process for maintaining confidentiality.  We vet and pre-qualify all enquirers and mandate that they sign a confidentiality agreement before any details are provided.

Depends how organised you are. We will need a lot of information to prepare the Business Profile to market your business. This will include accountant produced Financial Statements, leases, BAS statements and as much supporting information as possible to describe your business eg customers, products, suppliers, strengths… Remember you know your business far better than we do and so the more information you give us the better we are able to represent you.

After that though we handle all the time consuming parts of the selling process on your behalf so that you can continue to run the business without distraction and disruption.  Our buyer screening process avoids time wasters so we will only every introduce you to serious buyers.  Once the deal is agreed you will have to spend some time working with your solicitor and accountant to proceed to settlement.   Again, the more organised you are the easier this will be.

Valuing a business is not an exact science.  To do it accurately requires experience, industry knowledge, market knowledge and the ability to analyse and examine all the factors involved.

Market value can be determined by many factors including growth potential, cash flow, sector trends and activity, sustainable profit, asset value, financial history, location, competition, customer base, ongoing management, desirability and the state of the economy.

Some of the common base methods include

• Multiple of earnings – mainly used when a business has a history of sustainable profit
• Discounted cashflow – used for large cash producing businesses
• Asset value – this method is used when a business has a large tangible asset base such as plant and equipment or property
• Entry cost method – comparing the cost of entry with the value of the business
• Industry precedent – certain industries have their own unique valuation methods based on sector criteria.

Once the sale is agreed, a solicitor’s role is to draw up the contract of sale.  It is vital that you work with a solicitor whose main area of expertise is commercial law, specifically the buying and selling of businesses.  Choosing the wrong solicitor can cost you time and money and even put the deal in jeopardy.

A good accountant can assist with tax and preparation of financial information and analysis for the buyer during the due diligence process.

accountant, lawyer, mechanic. Experience, specialised support and focus!  A Broker has completed far more sales than you have and consequently will be aware of the areas where a transaction can go wrong and prepare for that. They have access to specialised support and software which allows them to manage such aspects as the advertising and Confidentiality Agreements much more efficiently and effectively than you. And most important of all – a Brokers job and complete focus is to sell businesses – yours is to run your business!

There is also significant value in having an independent person negotiate between the Buyer and Vendor. Selling and Buying can be very emotional and egos can come into play. You do not have to like your Buyer as you will not have to work with them beyond the sale. A Broker can remove the emotion and keep both party’s focussed on their primary objective ie to get the sale done.

It depends on the market conditions and what is for sale.  Our typical sales take between 6-12 months from start to finish.

This very much depends on your personal circumstances and objectives.  Generally, when it is doing well and you don’t have to.  Selling before a peak can add value to your business too – timing is key here.   The decision to sell your business is not one which should be taken lightly.  It is important to plan to prepare your business well in advance.  Going to market without preparation can seriously impact your chances of success.  Most businesses will sell if prepared, structured and priced correctly.

Nearly all businesses are saleable if they are priced correctly and are presented to enough people in the right sectors.

It is recommended that you have a thorough market appraisal prior to attempting to put a business on the market.  It can help highlight areas which if left unchecked could cost you thousands of dollars, cause unnecessary delays or even stall a sale

As much as a motivated buyer is prepared to pay and a motivated seller is prepared to accept!

The primary determinant though is the Profit ie what a Buyer can earn from the business. And that is based on proven performance not future expectation. In some industries Plant & Equipment is also a factor, however generally not as the assets are required to generate the Profit the Buyer is purchasing.

Next, a Buyer will consider other factors that determine the Risk associated with the business ie how likely are they to generate that Profit. These factors include competition and barriers to competition, customers (the more secure or certain the higher the value), suppliers (exclusive agreements are valuable), stability and quality of staff, and the economy.

What you or your accountant think your business is worth will have little credibility with buyers.  Only the marketplace can decide its true value.  Incorrect value and unrealistic vendor expectations are the principle reasons may businesses fail to sell.  Buyers will dismiss your business if it is not priced reasonably.