For Every Business Owner
Who Deserves The Ultimate Pay Day
ATTENTION BUSINESS OWNERS:
Do You Have An Exit Strategy?
Would You Like To Sell Your Business One Day?
How Much Is Your Business Worth and …
Will Someone Buy It?
For Business Owners who want to maximise the sale value of their
business, retire with more cash in the bank… and enjoy more
lifestyle choices… the time to act is now!
How to Sell my Business
You’d think selling a business would be easy, wouldn’t you? Well, actually it can be. But there’s a big difference between just selling a business and selling one effectively.
There is also a difference between selling a business because you want to sell, and selling a business when you have no other choice. In either case, however, you’re best bet is to already have a plan in place long before it becomes time to attempt to make that sale.
Having said all that, you’re here because you want to know how to sell a business. Luckily we have the answers for you. Specifically we’re going to tell you how to sell a business in Victoria, but you could easily apply nearly all of the information and use it as a guide for how to sell a business anywhere in Australia.
The laws don’t vary too much between the states, and it’s mostly just a matter of making sure you have properly registered everything with the appropriate state or federal authorities, depending on how you set up your business in the first place.
Getting an evaluation is the most important step in selling a business, no matter where you are selling it. You won’t know what an appropriate selling price is if you don’t have the valuation. Overpricing will make it harder to sell your business, and underpricing it will result in disappointment if you later work out you could have sold it for a lot more.
You can get help with valuing your business by contacting the expert consultants at The Exit Strategy Group in Melbourne. Having independent objective advice is exactly what you need when it comes to something as complex as business valuation.
Make sure everything is squared away
Don’t leave loose ends if you can avoid it. If you’ve got all the business affairs in order before you plan to sell, it looks much better for you and it makes selling much less complicated.
Obviously if you can settle all your debts and make sure your business has no current or long term liabilities, that will magnificently elevate the selling potential. Truly there is no better asset for a business to have than a solid Triple-A credit rating.
Ongoing legal matters are a bit more tricky. If you have litigation pending for or against you, it may not be up to you to get it resolved before you commence with selling your business.
Other than that, you have the chance to make sure everything is ship shape before getting ready to sell. This means having all the paperwork in order, accounts up to date, business premises clean and tidy, employees brimming with enthusiasm and optimism, and so on.
You want your business to look as good in person as it does on paper, and of course you should make every effort to get it looking as good as possible on paper first.
Work with an agent when selling a business
Yes, agents take a fee for matching you with a buyer, but they can also help you get your business sold more quickly, and for the price you want to sell for. Naturally the price you want to sell for should not be lower than your valuation price.
Just watch out for agents that suggest you drop your price significantly. Sometimes they’ll be advising you sincerely, but there are some agents who will put their own interests ahead of yours. They may want a quick sale to earn a commission, or they may intend to simply acquire your business at a bargain price by getting a friend or family member to buy it.
Fortunately there are very many ethical agents who will sincerely try to help you make a sale for the best price you can get. They can also be a good source for valuable advice.
Once you’ve sold the business, don’t celebrate too soon
If you have sold a business, you haven’t really sold it until the records are officially updated in the government business registration records and the money is safely in your bank account.
Only then can you be certain that the business is sold. Then it’s fine to celebrate. The next day after you have recovered from the celebration, your accountant is likely to call with some sobering news.
Now that you have successfully sold your business, you will be liable for Capital Gains Tax (CGT) on the sale price. The nasty part of that is you have to pay that tax even if you made a loss on the sale. Then, after that, the tax man is going to come back at you and snatch away even more of your money, when you file your personal income tax return.
This is why it is so important to get an accurate valuation before you sell. So much of the money is absorbed by taxes and fees that in the end you want to be sure you’re left with as much as possible.
When is the right time to start planning how you will sell your business? Ideally before you even start the business. The best business plans always include an exit strategy, but many business owners don’t think about an exit strategy until they are ready to retire or the business runs into trouble.
Waiting too long to develop an exit strategy can be a huge mistake, and may cost you a lot of money when it comes time to sell your business.
When I think about how to sell my business, I need to have a good understanding of what the true value of it is. Obviously I want to sell my business for the highest value that I can, but knowing the true value will at least give me an idea of where to set my sights.
How to Sell a Business in Australia
There are also certain laws that govern how to sell a business in Australia, and the rules can be different depending on the business structure and also what state (or states) you are operating in. Companies are the most complicated to sell, while sole trader businesses are generally the easiest.
Capital Gains Tax (CGT) can also be a big problem. It’s important not to forget the impact of CGT and what it will mean to the income you receive from the sale (which is also taxed). After the tax man has had his way, that expected windfall may be looking a lot slimmer.
Anyway, before we start worrying about the things that might reduce how much money we can receive from the sale, we need to establish the value of the business. That is not just a matter of looking at the balance sheet and trying to work out the value from that, because accountants don’t look at the bigger picture.
Some of the things that have an impact on the overall business value include:
- Intellectual property
- Proprietary rights
- Value of contracts
- Litigation the business is involved in
- Eminent domain (compulsory acquisition) proceedings against the business
- Competitive advantage or disadvantage
- Third party property development near key business locations
Those are just some of the factors that can affect the value of a business. But the easiest way to get a handle on the value, and find some clear direction in how to sell a small business, is to get in touch with The Exit Strategy Group.
Selling your Melbourne business
A statement often raised by clients at The Exit Strategy Group consulting rooms is: “I want to know how to sell my business.” If you’re in the same boat, you’ll be glad to know The Exit Strategy Group is the foremost authority on how to sell a business in Melbourne.
You need no longer be vexed by the problem of how to sell a small business in Australia, because we have all the information you need, and we can help you in many more ways as well.
There is indeed a lot of confusion over how to sell a small business, and most of this confusion is due to the complex and sometimes contradictory information published by government sources.
Generally the information provided by government sources to business proprietors is incomplete and only covers very simple scenarios that won’t apply to many businesses. It can be a frustrating task to try and get a clear picture of what the requirements are.
Otherwise information has to be gleaned from hefty tomes of academic instructions, often written in legalese, and this too can be frustrating.
Expert advisors to Australian business owners
Founded by serial entrepreneur and author Kerry Boulton, The Exit Strategy Group is a progressive business advisory group, mainly consulted by those preparing exit strategy plans.
Usually the best way to get a reward for all the hard work invested in growing your business is to sell it, and with help from us, many Australian business owners have achieved the best returns from their sales.
There are many important considerations that business owners need to take into account before preparing to sell. For example, you will need to think about the impact of Capital Gains Tax (CGT) on your sale return, and factor it into your pricing strategy.
It is attention to the details that makes The Exit Strategy Group a trusted advisor to business owners in Australia, because we make sure you know exactly what to expect, and that you’re not kept in the dark on these important details which you’d often have to spend hours searching through multiple sites just to get a glimpse of.
To find out more about how The Exit Strategy Group can help you, call us today on 1300 394 878.
The Exit Strategy Group can assist in working out how to calculate what your business is worth, how to value your business, business succession planning, how to sell a small business and transition planning.
In this breakthrough book, you will discover there’s more to a profitable
exit strategy than just selling your business…with answer to these and
many more myths believed by countless business owners :
Myth #1: I don’t need an exit strategy until I’m ready to sell my business
Myth #2: I can’t afford to dedicate the time involved with exit planning
Myth #3: The wealth of my business is defined by how much I earn
Myth #4: If I have a growth strategy, why do I need an exit strategy?
Kerry Boulton, CEO and Founder of The Exit Strategy Group and NEXUS Business
Coaching, is Australia’s most respected exit strategy advisor. With over 20 years in
business as an entrepreneur, transformative coach and consultant, sought-after
speaker and talented facilitator, Kerry wrote The Uncensored TRUTH About Exit
Strategies to help as many business owners as she can to monetise the wealth that’s lying in their businesses.
The Uncensored TRUTH About Exit Strategies details how to build a strong and
successful exit plan, which is an absolute must if you want to get full value from
any sale. Kerry exposes and debunks many myths and gives you practical advice. She
walks you through what most people don’t know – or refuse to believe – about the
process of planning their exit.
Kerry believes exit planning is a process, not a destination. She helps you overcome
challenges you’re likely to face as a business owner and most important, the steps to
ensure you find financial freedom and do not become just another statistic.
The Cold Hard Facts You NEED to Know If You Want To Sell Your Business Someday
81% of Australian business owners plan to retire in the next 10 years
53% of them have no exit strategy
22% will shut shop*
How To Increase The Value of Your Business By Up To 71%* In Just 24 Months …and Have the Biggest Pay Day of Your Life
*Based on actual client results to date
Are you ready for the huge wave of business sales looming on the horizon and a lot of potential competition? Buyers will be picking and choosing only the best. Email info@TheExitStrategyGroup.com.au and ask for your FREE Value Builder Report.
AND…when you order your FREE copy of my book, The Uncensored Truth About Exit Strategies” you’ll find out …
…there’s a lot more to your Exit Strategy
than a succession plan or just selling your business…
You’ve worked hard for years building your business. You know how much value you’ve created and it’s worth plenty to someone who can take it to the next level.
The question is – how do you even start thinking about your exit plan when you aren’t anywhere near ready to exit or sell your business?
The gap between the idea of selling – or creating any sort of succession plan – and actually getting the deal on the table on your terms and at the time you want – can be very wide and very deep.
The fact is…only 20% of business owners who say they plan to sell their business ever make it their ultimate pay day.
That’s a very sobering statistic. Will you be in the 20% who do?
Many business owners simply don’t know what they need to know to prepare for succession, transition of ownership and exit. Exit strategies are not just about making money, Business owners often have other goals such as establishing a legacy, ensuring the business remains in their family, or continuing to have a say in what happens in the business.
…No matter what exit strategy you choose – you can guarantee your best outcome by simply this: PLANNING IN ADVANCE. There are immediate benefits to getting started preparing your exit strategy. You don’t have to wait for the exit date before claiming more of your wealth!
Exit strategies are something every investor looks for… The questions are the same – no matter what the size of the business. How am I going to get my money out?And how much are you going to get as the owner?
Having an exit strategy worked out in advance helps ensure you like the answers to those questions and gives you some control over your business’s future.