CHILDCARE PROCESS FOR BUYING A CHILDCARE CENTRE Are you looking to enter the Childcare industry and buy a Childcare business? Or, qualified/ experienced in the industry and wanting to buy your own Center? The steps listed below need to be undertaken in the order listed. 1. Creation – see an accountant – read recommendation below. […]
CHILDCARE PROCESS FOR BUYING A CHILDCARE CENTRE
Are you looking to enter the Childcare industry and buy a Childcare business? Or, qualified/ experienced in the industry and wanting to buy your own Center?
The steps listed below need to be undertaken in the order listed.
1. Creation – see an accountant – read recommendation below.
2. If no Childcare qualifications consider enrolling in a Cert IV or Diploma to show ECRU you are serious about learning. You are not legally required to have qualifications or experience in childcare to apply for a Provider number.
3. Lodge Provider Application in the name of the “Entity” e.g. Company/Company & Trust you have established.
4. Study – The Exam is hard.
5. Receive your Provider number – you have approximately two years to secure/open a business or it may be canceled.
6. Decide on a business to buy/establish. Lot less risk in purchasing an existing business for first time business buyers. Qualified staff/management in place/resourced/has been approved for Childcare by ECRU holds a Service Approval. No guarantee with a start up you will get a Service Approval.
7. Complete conditions of Business offer/contract – Transfer of Service etc
8. Congratulations – You now own a business in the Childcare sector. One of the, if not the, most in demand business you can Buy in Australia. Guaranteed Government Funding – Robot proof – High demand – Can be highly profitable.
Step One – Entity Purchase in
The first step in purchasing a childcare business is deciding on the entity you wish to purchase the business in. That might be a Company, a Company & Trust or other entity structure. A company can be organised via ASIC or via your accountant. A company and Trust will require an accountant or a lawyer to establish. What is the best option for you should be discussed with your accountant.
If the Company has 3 Directors ECRU will probably insist all three Directors go through the exam/interview process. Therefore, if there is a person in the Company who is childcare trained or has Education experience it is best to only have them as sole Director.
They will then be the only person required to go through the approval process and will have a better chance of success. If there are multiple Directors of the Company and e.g. two Directors are required to sit the exam and one of the Directors fails then usually ECRU will fail both Directors. Shareholders are not required to undertake the approval process, however, they will be vetted.
ECRU requires the Director (person applying for approval to hold shares in the Company). What % will depend on entity structure and should be confirmed with ECRU prior to lodging Provider application.
Step Two – Enrol Childcare qualification
If you are new to the Childcare industry it may assist the Provider approval process if you can confirm to the approval body ECRU – Department of Communities, that you are serious about childcare by being able to say you are enrolled in a Childcare qualification.
It is not a legal requirement to have qualifications or experience in childcare to buy a Centre. However, in recent times ECRU have not looked favorably on applicants (even if they have passed the exam) that cannot demonstrate in some way their dedication to the industry beyond paying for a business.
Step Three – Apply for Provider number
To be able to own and operate a childcare business your entity purchasing the business must hold a Provider number. The persons associated with that entity e.g. Director/s must be ECRU approved.
This Provider number is applied for via the Department of Communities – Child Care section in the State you live in or the State you are buying the Childcare business in.
Once approved/received, the Provider number is valid for all of Australia. You can own multiple businesses around Australia under the one provider number.
The Provider number is attached to the entity e.g. Company – Company/Trust you have set up that will ultimately own the Childcare business or businesses.
The price is $241 for 2022 -2023.
The Provider number once obtained does not last forever. If you have not purchased a center within a period of approximately two years from time of issuance the Department may cancel the number.
The application will require credit checks into the Company history and of ALL the Directors of the Company.
Sellers will rarely accept offers from Buyers that do not hold a Provider number due to the time involved to obtain and risk of the Buyer not being approved. The process (exam) is much harder since 01 May 2022. Resulting in a higher fail rate.
The time quoted by the Department of Communities for Child Care Provider Number is currently 120 days, however, the Provider approval process in July 2022 is taking 180 days or longer. Refer section 15 of the Act for more information.
Step Four – Provider Application Assessment / Examination
Effective 1 May 2022, ECRU ( Education and Care Regulatory Unit) is now conducting on-line assessments for Provider Approval suitability in an exam format and subsequent interview.
The exam comprises 46 multiple choice questions to be answered in 75 minutes and no reading time. Several applicants have advised they did not finish in time.
You can flag and skip a question, going back to an answer later.
Exam
75 mins
46 multiple choice questions (no short answers)
No outside material/ resources can be used.
You are provided with online access to the required documents for the assessment. Two screens set up, which are easy to use and navigate
Most of the questions were scenarios wanting the law and regulation reference
You need to be very confident in navigating your way around these documents
If you are unsure of an answer, you can flag it and return later.
Below is an overview of the documents and information that should be studied.
A very thorough knowledge of the Regulations and the ACT is required to be able to identify and know Regulation numbers and information quickly. Some of the questions relate to multiple regulation numbers e.g. is it 76/22/14 or 42/1/23 etc
What needs to be displayed for rating assessment
SQM inside – outside
Fencing
Ratio
Healthy eating
Forms documents how long keep – what need to be in centre – how maintained
Child protection
Who responsible what
Notification of incidents
Applicants sit the exam in the ECRU offices in Perth. Usually offer only one date per month. It is very important participants answer the questions as quickly as possible.
ECRU provides some reference materials, a pen and some paper.
A buyer may have their wife/sister/friend/Centre Manager of an existing business, as Company Director to obtain Provider number and have them as the Company sole Director.
Or, if there is a good manager in place at the center, who is willing to come on board as Company Director and hold the Provider, that might be an option. Once you own the center and gain experience, there is a far better chance you will pass the exam and be approved by ECRU in the future.
If you receive a pass mark which is above 80% then you will be called in for an interview.
The interview takes place around 4 weeks after the exam. The interview around an hour will again be on your knowledge of childcare.
Business Plan
A business plan is required from buyers for ECRU.
A business plan is usually required to be submitted prior to sitting the exam. Where an applicant does not currently own a business or started to build a centre, then they will need to base their plan on what would be their ideal centre that they are hoping/planning to operate.
The business plan needs to incorporate:
- Costings
- Financial expectations
- Budget
- KPI’s
There is a business plan template available via the ABB website under resources. There are also advisors on the ABB website that specialize in creating business plans for a fee. I would therefore recommend that all provider applicants commence their business plan as soon as they have lodged their Provider application, to ensure that it is ready to be submitted as soon as requested.
A Business plan will also be required by PRODA when a centre has been purchased or about to open. The PRODA business plan should be an extension of the Provider business plan.
“Study study and study” in the words of a successful applicant. Make sure you are very very familiar with the Regulations and the Act.
The Provider certificate will arrive in the post.
See resources below:
Applications and notifications forms – https://www.acecqa.gov.au/resources/applications
Business Plan Template
Step Five – Receive Provider Certificate with number
If the interview is successful you will be advised approximately 3 – 4 weeks later and receive your Provider number certificate in the mail.
Step Six – Buy a Business
Once you have received your Provider number, you can then proceed with your purchase or look for a childcare business and advise the broker/owner you are already in possession of your Provider number.
Step Seven – Conditions of Business Contract
Child Care Centres – Existing Child Care Providers
Once you hold a Provider number the next step is the transfer of the existing Service Approval of the Centre being sold.
Finance must also be approved in writing by a finance provider prior to lodgement of Transfer of Service Approval.
The transfer of Service is legislated to be 42 days from receipt of correct application with the Department of Communities.
If the buyer is purchasing the Centre in a New company they will need to apply for a NEW provider number for that particular Company and may be required to complete the whole Provider process mentioned above, including sitting the exam.
CCS – Funding for parents with children in Childcare – PRODA
If the buyer has a contract in place to purchase a business, and has applied for and received their Provider number, then as soon as their Provider number is issued, they should lodge their application for CCS funding. This application can take 42 days or longer.
If you are an existing Child Care operator already with a PRODA account and receiving CCS funding, then your new service/business must be added to your existing PRODA account.
For an existing Child Care operator or new applicant, ensure as the Buyer of a Childcare Service you have this completed in advance of settlement so there is no disruption in CCS payments to parents. This form to PRODA should be lodged at the same time as Transfer of Service or earlier if possible.
Any questions need to be directed to the relevant Government department.
Transfer of Service can only be lodged with a Provider number.
The current price is $116 2022-2023.
Step Eight – Settlement
Settlement on a childcare business usually occurs on a Friday (due to Government funding going Monday to Friday) usually two weeks after Transfer of Service is unconditional as per letter received from ECRU.
Please note childcare centers are hard to come by. They are in high demand and to enter the industry will require flexibility on the part of the Buyer in regard to location and price.
If the center has been operational and profitable for over two years a Buyer may be able to secure finance at 50% of the business price or 60% – 70% of the business & property price if purchasing both property and business at the same time. Finance brokers who specialise in finance for Childcare centers are under Resources on ABB website.
The price of childcare centers can range from $100,000 to $4,000,000 + for an individual center (no property) depending on net profit, location, size and age.
Currently individual businesses are selling in the Perth metro area for a multiple of 3 to 4.5 x net profit including add backs. Group sales can achieve 6 to 7 x net profit.
Regional locations e.g more than two hours from Perth CBD usually sell for multiples of 2.5 – 3 x net profit.
We hope you have found the above useful.
Click HERE to access the PDF version of the Childcare Process!
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
Why buy a business that already exists instead of starting one from scratch? What you are buying is a proven track record. An existing business has infrastructure, financial history, brand power, assets, staff and more. Some estimates say that one in three new small businesses in Australia fail in their first year of operation and […]
Why buy a business that already exists instead of starting one from scratch?
What you are buying is a proven track record. An existing business has infrastructure, financial history, brand power, assets, staff and more. Some estimates say that one in three new small businesses in Australia fail in their first year of operation and two out of four by the end of the second year. By understanding the history of an established business, you are mediating the risk of starting from scratch
The business sounds great, so… why are they selling?
The reasons for sale differ from business to business but don’t be afraid to ask us why the seller has decided that now is the right time to sell. Some owners wish to retire in the near future, others are relocating out of Perth. Some sellers simply had an end goal to sell after they had built a successful business – allowing them to move on to another venture.
We operate with full transparency and in order to sell a business, we require a seller to provide full financial information which is available to potential buyers after they have been vetted and signed a NDA
Is buying a franchise a good idea?
There has been a boom in franchising in recent years – you can find a franchise for sale in almost every industry. Unlike setting up your own business, when you buy a franchise the franchisor owns the brand, intellectual property and associated operating systems. You will benefit from a well-known brand, typically with a long history and a good reputation. The business model is established, so you will get access to refined procedures, operating manuals, stock control systems, financial systems and more. Franchises also tend to have good initial training, ongoing support and assist with marketing/advertising. Banks will usually lend on a Franchise where they probably won’t on a non-franchise business in the same industry e.g. food
When can I see the financials?
The majority of sales are confidential sales and as such potential buyers are are asked to sign a NDA (non-disclosure agreement). Once signed, you can review the business summary with financials.
What happens if my offer is accepted?
If an offer is accepted a deposit is payable and a settlement date is set. Due diligence is completed subject to the buyer’s satisfaction. Depending on the business this could be very simple or more complex for larger businesses
What is due diligence and who is responsible for it?
The buyer can ask any questions they would like to understand the full business picture and get the confidence they need to continue the business. For example; can the claimed revenue and profit be verified? You may also wish to see legal agreements such as licenses, permits, insurance policies, lease agreements, employee details, supplier contracts and more. The seller is responsible for collating information that the buyer requires. A solicitor and accountant can be engaged at this point for any professional advice. How long the due diligence process takes really depends on the business but you should allow roughly 15-30 days minimum.
What other costs need to be considered apart from the purchase price?
Stamp Duty, Settlement agent, cash flow, bank guarantee/bond if commercial lease. Also any fees applicable to the industry where transfers are required and when purchasing a Franchise the up-front fees to the Franchisor.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
Selling a business can be a complex and emotional process, with a lot at stake for both the seller and the buyer. Unfortunately, many business owners make common mistakes when selling their business that can significantly impact the final outcome. This article will discuss some of the most common mistakes people make when selling their […]
Selling a business can be a complex and emotional process, with a lot at stake for both the seller and the buyer. Unfortunately, many business owners make common mistakes when selling their business that can significantly impact the final outcome. This article will discuss some of the most common mistakes people make when selling their business and provide tips on how to avoid them.
- Failing to Plan Ahead
One of the biggest mistakes business owners make when selling their business is failing to plan ahead. Selling a business generally isn’t something that can be done overnight – it requires a lot of preparation and thought. Many business owners don’t start planning for a sale until they are already in a financial crisis or experiencing burnout.
To avoid this mistake, business owners should start planning for a sale one or even two years in advance. This will give them enough time to prepare the business for sale and address any issues that may reduce the value of the business. Planning ahead will also help business owners avoid feeling rushed and overwhelmed during the sale process.
- Overvaluing the Business
Another common mistake that business owners make when selling their business is overvaluing it. This can happen for many reasons, including emotional attachment to the business, a lack of understanding of the market, or an unrealistic view of the business’s potential. However, overvaluing a business will often lead to a lack of interest from potential buyers or a lower sale price.
To avoid this mistake, business owners should have a realistic understanding of a fair market price for their business. This can be done by conducting a business appraisal that takes into account factors such as financial performance, market trends, and comparable sales. Having a clear understanding of this fair market price will help business owners set a realistic asking price and negotiate with potential buyers.
- Neglecting Financial Records
Neglecting financial records is another common mistake that business owners make when selling their business. Well presented accounts for two years or more, is valuable in the saleability of a business. Profit and Loss with a strong net profit figure and clearly identifiable add backs. E.g. interest, depreciation, Associated Directors/owners wages/superannuation.
Buyers and their accountants will need to review financial records to evaluate the business’s financial health and potential for future growth. If financial records are incomplete or inaccurate, it can reduce the value of the business or even scare away potential buyers.
To avoid this mistake, business owners should maintain accurate financial records and be prepared to provide them to potential buyers. This includes income statements, balance sheets, cash flow statements, tax returns, and any other relevant financial information. Having accurate financial records can also help business owners identify areas where they can improve the business’s financial performance and increase its value.
- Failing to Prepare the Business for Sale
Buyers will want to see that the business is well-maintained, organised, and ready to be transferred to new ownership.
This may include organising files and documents, completing any outstanding repairs or renovations, and ensuring that all equipment and assets are in good working order.
- Not Engaging a Professional Business Broker
Finally, many business owners make the mistake of not engaging a business broker to help them sell their business. Business brokers have the experience and expertise to help business owners navigate the complex process of selling a business. They can also help business owners identify and qualify potential buyers, negotiate the sale price, and ensure that all legal, financial and regulatory requirements are met.
It is important that the broker chosen has a thorough understanding of the business sales market in the industry the business is located in. This will also mean they should have a pool of potential buyers in their database.
With less than 50% of businesses listed in Australia selling, and an average time on market of over 6 months it is critical that business owners take measures to avoid these mistakes to give the best chance of a successful business sale.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
The five entities that a buyer may choose to set up to buy a business in are: A company A company and trust A trust on its own A partnership Sole trader In my experience, the majority of buyers buy their business in a company entity. It is also becoming common for accountants to set […]
The five entities that a buyer may choose to set up to buy a business in are:
- A company
- A company and trust
- A trust on its own
- A partnership
- Sole trader
In my experience, the majority of buyers buy their business in a company entity. It is also becoming common for accountants to set up a combination of company and trust.
As always, what is best for your needs, is to be discussed with your accountant.
In Western Australia — where stamp duty is payable on the purchase price businesses — once the entity has been entered on the contract of sale, not so much as a letter in that entity name can be changed without the possibility of the State Revenue office of WA charging double stamp duty.
Stamp duty is charged on the sale price of the business in a couple of States. A buyer’s settlement agent or lawyer can advise the amount applicable, or you can go online via a calculator from the State Revenue site. This will calculate the amount of the stamp duty that will be payable on the purchase price.
A company name is registered via ASIC.
This can be done via your accountant, or there are companies that can also arrange this quickly and easily for a set fee. See under Resources on ABB site.
Generally, your accountant will handle this for you. If it is going to be a company as Trustee for a Trust, then the company and trust must go on the contract of sale to buy the business. Your accountant should provide and confirm the exact wording at time of contract.
Registering Your Company Name
A company name is registered via ASIC (Australian Securities & Investments Commission).
An ABN (Australian Business Number) is not required on a contract of sale; however, if a company is buying a business, the ACN (Australia Company Number) will be required if the ABN is not yet available.
Tax Implications
There are various tax advantages which your accountant needs to explain, depending on the type of entity that you choose to buy a business under.
It is advisable to make sure that you get it correct from the start. It can be a very time-consuming and costly process to try and change three months or three years later.
Some people prefer to commence as a sole trader and look into changing to a company at a later date, particularly if the business is a small or trade business.
On occasion, a buyer may consider buying the company of the seller who owns the business, instead of the business. This may be done if there is a real need or reason to the advantage of the buyer, i.e. the company owns a license that is difficult to obtain or time-consuming to obtain.
Remember — when a buyer purchases a company, they are also buying the history of that company. A buyer purchasing the shares in a company needs to be very careful that they are legally exempt from responsibilities, liabilities, and debts both historically or currently of the company relating to both past directors and the Company entity. This is the main reason 99% of small to medium business sales are business only purchases, not Company share transfers.
By : Angela Williams
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
Perth is Buzzing! Perth, the sunny and beautiful capital city of Western Australia is commonly known as one of Australia’s greatest innovators of science and technology, largely thanks to Western Australia’s booming mining and energy production. Perth is bustling with entrepreneurs and innovation, both SME and large enterprises. Perth can truly be defined as a […]
Perth is Buzzing!
Perth, the sunny and beautiful capital city of Western Australia is commonly known as one of Australia’s greatest innovators of science and technology, largely thanks to Western Australia’s booming mining and energy production. Perth is bustling with entrepreneurs and innovation, both SME and large enterprises.
Perth can truly be defined as a global city, largely due to its proximity to Asia, making it a bustling hub of agriculture, tourism and hospitality, food and education. With a population of over 2.1 million (2020), if you are currently looking to buy a business in Perth, there are countless opportunities available to you.
What Types of Businesses for Sale are Popular in Perth?
Perth, being a capital city, has a large array of businesses available for sale. As always cafes, restaurants and bars are extremely popular, as are tourism-style businesses, building and construction and manufacturing businesses. Childcare is flourishing due to a large amount of the workforce being involved in FIFO/mining. Western Australia is well known for its mining industry, so Perth is also a good choice for those looking for civil construction businesses as well.
So You’ve Made the Decision to Buy a Business in Perth?
At the moment, the City of Perth is offering millions of dollars in initiatives for businesses looking to innovate their practices. For example, the Local Activation Grant offers businesses up to $15,000 in support for events and businesses that participate in local events that activate the community in activity. This is a great chance to market your business and engage with the local community!
When buying any business it is strongly recommended that you conduct your due diligence. Ensure you have evaluated any risks, as well as any opportunities to further extend and expand the business. You will want to assess the financials, including operational costs and assets.
Advance Business Brokers can assist with many of these enquiries and provide links to professionals in all areas of buying a business.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
Buying a Business as an Investment Buying an existing business offers a number of advantages from an operational standpoint. You receive established infrastructure, staff, proven marketing and sales strategies, and an ongoing cash flow. But is the prospect still an attractive one when you consider your purchase as an investment? Is buying a business a […]
Buying a Business as an Investment
Buying an existing business offers a number of advantages from an operational standpoint. You receive established infrastructure, staff, proven marketing and sales strategies, and an ongoing cash flow. But is the prospect still an attractive one when you consider your purchase as an investment?
Is buying a business a sound investment?
The soundness of your investment depends on which business you buy, for how much and how effectively you conduct your due diligence.
It may also sound like a given, but ensuring your expertise and experience align with your purchase can be the difference between seeing a healthy ROI, and watching your investment spiral down the drain.
Purchasing a business that’s already done the hard work to get off the ground brings with it less risk. You’ve got a concept that’s proven to be successful and you’ve safely passed the initial one year window where 20 percent of new businesses fall over.
But the hard work isn’t over. Some businesses may require a hefty injection of capital to upgrade machinery, bolster their working capital cycle, systems or software. Others may need a structural rejig that can take months to successfully execute.
The advantages of buying an existing business
Purchasing a competitor’s business is a highly effective way to increase your market share. You don’t need me to point out the benefits this presents, from the increased customer base, trained staff to the increase in value proposition. You’re simultaneously knocking out the competition while acquiring an established pool of customers. From there you can foster the growth of these existing connections, rather than attempting to establish new ones.
Similarly, you can buy a business that offers a complimentary service or product to the business you already own. For instance, let’s say you own a mortgage brokerage. A strategic business acquisition may be the purchase of a Property Buyers Agency. The alignment of both businesses would allow you to deliver a holistic service offering to property purchasing.
Easier to secure finance
Lenders look more favourably on the purchase of an established business over funding a new one to get off the ground. It makes sense from the banks perspective – there’s a proven track record of revenue and execution, minimising the risk of the unknown. As a buyer, this can go a long way to helping you secure finance to make your purchase.
There can be many advantages in buying an existing business rather than the time and considerable outlaw involved in starting from scratch.
Above are only a couple of the main advantages.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
It’s that time of year to muse on what you hope to accomplish over the next 12 months. The best advice when making resolutions is to set goals that are “SMART” – specific, measurable, achievable, relevant (to you) and time-bound. Once you’ve set your goals, what can help you achieve them? Based on our research, […]
It’s that time of year to muse on what you hope to accomplish over the next 12 months.
The best advice when making resolutions is to set goals that are “SMART” – specific, measurable, achievable, relevant (to you) and time-bound.
Once you’ve set your goals, what can help you achieve them? Based on our research, we’ve distilled 12 goal-enablers. These cover four broad principles you can use to keep yourself on track.
You don’t have to do all 12. Just focusing on the most relevant three to five can make a big difference.
Set relevant supporting goals
An outcome goal isn’t enough. Set clear supporting goals that equip you to attain that outcome.
- Behavioural goals stipulate the actions required to reach your outcome goal. If you want to change jobs, for example, behavioural goals could include working out what job you want, networking with relevant people, getting advice on your resume, and submitting at least three job applications each month.
- Learning goals are the knowledge and skills you need to achieve your goal. Ways to identify your highest-priority learning goals, and how to attain them, include seeking advice from others who have mastered the skill you aim to learn, working with a coach, or watching instructional videos.
- Sub-goals are small milestones on the way to your goal. They indicate your rate of progress towards attaining your ultimate goal. They can also provide a motivating sense of momentum.
Sub-goals are stepping stones on your way to achieving your end goal.
Build your internal motivation
- Connect goals to passions. If you like feeling like you’re on a mission, try framing your goals as reflecting a novice, apprentice or master level of development.
- Engage in mental contrasting. This involves toggling between focusing on a vivid written or visual depiction of your present state with your desired future state.
- Build self-efficacy. Your self-efficacy is your belief in your capacity to succeed at a particular task. Set modest initial goals you are likely to achieve (see point 3). Ensure you have adequate resources and support (see point 8). If you find yourself thinking defeatist thoughts – “I don’t think I can do this” or “I’m too old for this” – then stop and think more encouraging thoughts instead. In words to Tony Robbins “If you think you can’t your won’t – If you think you can you Will”.
- Implementation intentions stipulate when to pursue behavioural goals. These intentions increase the odds of attaining any goal. Two types are:
- When-then intentions (for example: “When I am tempted to eat a snack, then I will drink a glass of water and wait 10 minutes to see if I still feel I need that snack”)
- After-then intentions (for example: “After I eat lunch each day, then I’ll walk for at least 15 minutes somewhere green with my phone off”).
- Ensure adequate resources. These could include adequate materials, technology, support of others, time and energy (enabled by an effective recovery routine).
- Seek useful feedback to help gauge your progress and correct errors. Try asking the following questions: What happened? What went right? What went not so well and why? What can be learned? What are one or two things I can now do differently?
Anticipate and manage obstacles
As boxer Mike Tyson once said: “Everybody has a plan until they get punched in the mouth.” You need to be realistic about competing priorities and distractions bound to get in the way.
- Identify and plan to manage points of choice, where other temptations may divert you from pursuing your goal. Points of choice may arise from within yourself (such as feeling tired, distracted or uninspired) or your surroundings (such as work pressures or family responsibilities). Plan ahead as to what you will do when these points of choice arise.
- Remind yourself it’s OK to make mistakes.
- Keep building your commitment. Lose that and all bets are off! All the above steps will help. It can also help to share your goals and progress with others, but choose carefully. Share your journey with people you respect, whose opinion of you matters, and whom you know won’t be a wet blanket.
Government Grants There is a big difference between being government-funded as a business, relying on continuing funding from one financial year to the next and a grant. A government grant is a one-off opportunity that recipients really need to “make the most of”. One of the main takeaways learned throughout the grant application process has […]
Government Grants
There is a big difference between being government-funded as a business, relying on continuing funding from one financial year to the next and a grant. A government grant is a one-off opportunity that recipients really need to “make the most of”.
One of the main takeaways learned throughout the grant application process has been recognising that it is different to running a business where you receive funding from one strategy cycle to the next. Due to the nature of the grant, you not only have a finite time to maximise how you use the funds themselves, but also the introductions and relationships that will allow you to continue your business growth for this start-up and into the future.
Managing the Grant Application
For businesses looking to apply for grants and see what opportunities might be available to them, is to identify their business strengths. How they not only fit the criteria for the grant that was tendered but also recognise “Long-term vision and short-term planning so that you can execute during that grant period.”
Grant application tips
- Be a strong contender
You will recognise if you are right for the grant, it will be as clear as daylight that you are a good fit for the grant when you read the grant objectives and guidelines, so you have got to carefully and thoroughly read what they’re asking for.
It’s a very competitive process, all grants are, it’s like going for a great big job that they will see you as a contender, otherwise, the effort required (because it’s really hard work to apply for a grant) to manage the grant requirements going forward, you have got to be sure that you’re a strong contender.
- Show that you understand the problem and know how to solve it
When you’re looking at the government’s objectives that they will have articulated in the ad for the grant, you have got to really read the strategy piece that is behind it and pull the magic keywords from that. They will have had a report written at some stage and whoever has written the ad for the grant, the public servant who has written and referenced that, go and read that report and find the problem that they are trying to solve, the government is always trying to fill a gap and solve a problem.
Go and understand what that is and what their strategic objectives are and highlight the keywords that they’re using, use them back in your application so that it’s really easy for the public servants who are assessing your application to understand that you “get it”.
You need to really understand the question that is on the submission of the application form. Like writing any submission you have got to really answer the questions, and provide evidence to back up your response.
- Think of the political master
Whatever you are offering through your business and your pitch for this grant about what is going to be achieved, just imagine the politician that has that department in their portfolio, imagine them launching the program or cutting the ribbon.
Imagine what they are feeling, would they feel really good about it? Will they think “I’m going to get votes out of this”? There is always that political master there.
- Work WITH the public servants not against
When you win the grant when it comes to your requirements and the obligations and reporting whatever your deliverables are don’t fight with the public servants. Just make their life easy.
Give them all the details they need, get it to them on time, and keep them informed so that there are no surprises. Work your relationship with the public servants whose job it is to manage the grant on their side, make their job really easy so that they are going to be very supportive of you so that they will promote you internally up the line.
Just always remember to make the public servant’s life easy.
There can be Government grants available for various industries and location settings. It can be beneficial for intending business owners or current owners to keep in touch with the applicable websites State & Federal that may have grants available to assist you to grow or establish your next or current venture.
Are you buying a business in Perth? Do you have a Perth business for sale?
For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
Professional Indemnity vs Public Liability Insurance – What’s the Difference? It seems these days there’s an insurance product for every scenario in business, but it can be financially unviable to cover every possible risk. Two types of insurance that are worth considering however – depending on the nature of your business – are Professional Indemnity […]
Professional Indemnity vs Public Liability Insurance – What’s the Difference?
It seems these days there’s an insurance product for every scenario in business, but it can be financially unviable to cover every possible risk.
Two types of insurance that are worth considering however – depending on the nature of your business – are Professional Indemnity insurance and Public Liability insurance.
But what are they? Professional Indemnity vs Public Liability, what’s the difference?
To help understand these insurances, we have explored them in detail and explained why you might need them.
What Is Professional Indemnity Insurance?
Professional indemnity insurance is designed for professionals who provide advice or a service to their customers. It provides cover for claims made against your business by customers claiming that your specialist services or advice caused them financial loss.
For example, an accountant who incorrectly advises a client that an expense is tax deductible, or a solicitor who provides incorrect legal advice could find themselves facing an expensive claim if their client decides to take legal action against them. You should also consider personal trainer insurance if that’s your occupation as you’re often giving advice on fitness and wellbeing which could result in injury.
With professional indemnity insurance, professional people can work without fear that they may be sued by a client or a third party, allowing them to carry out their work with greater confidence and peace of mind.
What Is Public Liability Insurance?
Public liability insurance on the other hand, is insurance that protects a business in cases where property is damaged, or someone is injured during the course of business operations.
For example, if your employee goes to the home of a customer to carry out some repairs and accidentally knocks over their expensive vase, the customer could make a public liability claim against your business. This makes it important to have insurance for electricians, plumbers insurance, carpenters insurance or even landscapers insurance depending one your industry and occupation.
Similarly, if a client comes to your accounting practice and slips over in your foyer and is injured, a claim could be made.
If you have public liability insurance in place, you’ll be covered for these sorts of claims and your insurer will pay the costs incurred.
Professional indemnity vs public liability – while these insurances are fundamentally different, they share an important similarity. If you need to make a claim, they could save your business thousands of dollars if not more, and potentially, your business in its entirety.
Professional Indemnity Vs Public Liability – Which Do You Need?
- Do You Need Professional Indemnity Insurance?
If you provide a professional service where you are paid for your professional service or advice, you are well advised to consider taking out professional indemnity insurance. Policies can be tailored to suit the professional they cover. There is a broad range of professionals who provide a service that may result in a claim.
Below are some of the professionals that can be covered:
- Accountants
- Architects
- Barristers
- Bookkeepers
- Builders
- Engineers
- Management Consultants
- Photographers
- Project Managers
- Psychologists
Some professionals belong to industry bodies that set a minimum level of professional indemnity insurance that must be taken out by members. In some industries, professional indemnity insurance is mandatory before you can legally operate.
You can view industry fact sheets on the Australian Government’s Business website to find out a range of information such as recommended and required types of insurance on a per industry basis.
- Do You Need Public Liability Insurance?
In response to the question, professional indemnity vs public liability insurance, which do I need, let’s now look at public liability insurance.
Almost all businesses are well advised to consider public liability insurance. In Australia, it is the core insurance for most small business owners, contractors and sole traders. An everyday slip-and-fall accident incurred by someone coming on to your premises could cost your businesses tens of thousands of dollars so this type of business insurance is one your business really shouldn’t be without.
Public liability insurance helps protect you and your business against the financial risk of being liable for negligence.
Negligence is causing reasonably foreseeable harm, including:
- Injury or death, such as drink or food making a customer sick
- For some occupations, negligent advice such as saying a generator can power a business in a blackout but then it turns out it cannot and causes a loss
- Nervous shock, such as emotional distress or a recognised psychiatric illness
- Property damage, such as negligently causing a fire
- One or more of your employees accidentally damages someone’s property or even someone else
- Consequential loss, which occurs in very rare cases, where a negligent act causes a third-party business to lose expected revenue.
What Does Professional Indemnity Insurance Cover?
Professional Indemnity covers you and your business against claims and legal costs for damages caused by acts, omissions or breaches that occur in the course of business.
If you, your partners or staff do something or neglect to do something which causes a customer an injury or financial loss, you can be held legally responsible. A claim of malpractice, professional misconduct or breach of duty is not only time-consuming to defend, it’s expensive. Having a Professional Indemnity policy in place will protect you.
Below are some examples of what a Professional Indemnity insurance policy can cover:
- Negligence arising from a breach of professional duty due to an act, error or omission.
- Breaches of contract, such as not achieving the results of a contract (for example, not building a boat on time), or providing negligent advice (for example, giving bad financial advice or the wrong dietary advice).
- Fraud and dishonesty of staff.
- Libel, slander or defamation against a third party.
- Loss of client documentation.
- Mistakes providing a service, such as not auditing a company’s accounts properly or medical malpractice when performing a surgical procedure.
- Giving poor legal advice.
These examples demonstrate that if you provide professional services, you really can’t afford to be without professional indemnity insurance. While it’s a form of liability insurance, it’s not covered within general liability insurance policies so if you provide any form of professional advice, it’s important to consider this kind of claim could really cripple your bottom line.
What Does Public Liability Insurance Cover?
Public Liability insurance covers a person, a business, an event, a contractor – even a community building – for costs from legal action if they are found liable for death or injury, loss or damage of property, or economic loss resulting from their negligence.
Examples of public liability claims:
- A mechanic who makes house calls works on the brakes of a customer’s truck. As he tests the brakes, he drives into the back of the customer’s garage. The mechanic is responsible for the repairs. With Public Liability insurance he can claim on this.
- A lawyer based in an office suite has a window air conditioner. It falls from the window due to improper installation. The shop below has an expensive commercial awning, and the unit rips through the awning. The lawyer is responsible for the damages.
- A horse trainer works on a five-acre plot connected to a neighbouring orchard. A horse breaks free and tramples a full acre of newly planted seedlings. The trainer is responsible for the seedlings.
- A customer trips on a loose brick in a walkway. Injuries caused due to uneven sidewalks, driveways, paths, steps or stairs are claimable.
- Injuries due to slipping, tripping or falling within your store/place of business or on public grounds (restrooms, gardens, cafeterias) are claimable.
- Injuries from falling objects that occur on your property are claimable. Even non-customers who walk by your property could open a claim. A member of the general public who walks by a construction site and is hit by a falling hammer, for example, can open a claim against the construction company.
- In the case of public liability insurance, if you own a business, you may be liable for damages or injuries to another person or property. Though public liability insurance is optional in most cases, it is strongly recommended for businesses in all industries as the likelihood of being sued for negligence is unpredictable and potentially very costly.
Some Final Words On Professional Indemnity Vs Public Liability Insurance
So which insurance is right for you?
If you’re in business, it’s important to understand professional indemnity vs public liability insurance.
Whatever business you’re in, if there is a liability issue or a claim made against you, your insurance company handles the entire legal process for you. So, in the case of professional indemnity vs public liability insurance, you’ll be able to get on with your core business should the worst happen.
Source:
Murray Johnson| Dip of Financial Services (Insurance Broking) ANZIIF (Snr Assoc) CIP | Phoenix Insurance Brokers Pty Ltd
Johnson Insurance Brokers Pty Ltd AR 1283293 and Murray Johnson AR 1283294 are Authorised Representatives of Phoenix Insurance Brokers
mjohnson@phoenixins.com.au | www.phoenixins.com.au
0418 563 599 | 7 (08) 9754 2286 |
If you’re in the market to buy a business, you have come to the right place. Lease Agreement The lease agreement can have a significant impact on the success of a business. If you want to buy a business that relies heavily on foot traffic or a good location, the lease agreement needs to […]
If you’re in the market to buy a business, you have come to the right place.
- Lease Agreement
The lease agreement can have a significant impact on the success of a business. If you want to buy a business that relies heavily on foot traffic or a good location, the lease agreement needs to be reviewed in detail.
There are a few things you will want to check:
- Is the lease transferable?
- Are there any trade constraints?
- How much time is left on the lease?
- Options?
- What are the terms of the lease?
- Are there any scheduled rent increases?
- Are there any expected shop fit-outs?
- Does the owner intend to sell the commercial property?
- Are sales or profit tied to the lease payments – % rental?
- Can you change the business name?
- Local Developments
When you buy a business you want to ensure the opportunity will continue to be profitable. It is a good idea to check with the local council to see if any developments are planned that may impact your business. Especially if you are buying in a regional town, you will want to check if any major road changes or shopping centres are planned. These could have a dramatic effect on your sales and income.
It’s a good idea to speak with some local business owners about the area and if there are any talks of things changing. One of the most important things, when you buy a business, is ensuring the business will continue to operate at the same level (if not better). You are basing your decision to buy a business around its profitability, so you want to ensure it can continue.
- Non-Compete Clauses
One of the important clauses in a sale agreement is a non-compete clause. This can prevent the current owner from opening up a similar business in the local area for a set period of time.
This is very important in service industries such as childcare and other service businesses. If the current owner was to start a new business, they could take the existing client base with them, which would affect you and potentially decrease your profitability.
Check the Contracts and Agreements When you Buy a Business
- Contracts and Agreements
What has the current owner signed onto? You need to have a solid understanding of any agreements that the company has agreed to, such as ordering custom coffee cups or a new vehicle that’s due to be delivered. You need to know all the contracts that are in place, so you can factor these expenses into your budget.
A company may have agreed to order a certain amount of products every month, but they are struggling to sell. You want to buy a business that is profitable, not one that has a lot of debt and agreements in place that you may struggle to pay.
- Structure
What exactly are you buying? Are you buying a company, a business, a distribution right, a franchise? There are so many elements, you need to have solid professional advice so you understand what exactly you are buying and committing to.
When you buy a business you may be relying on team members, products, equipment, trademarks, clients, suppliers, distributors and so on for its operation. Reviewing all these elements is important when you buy a business as you want it to continue to operate smoothly after the transition. It is during the due diligence process you can review all of these elements and make decisions if this is the right opportunity for you.
Do Your Checks When you Buy a Business
When you buy a business you are entering into legally binding contracts. With a Business purchase (not a Company purchase) you do NOT take on l the assets and liabilities of the company entity selling the business. That is why the sale of businesses is the most common form of business sale transaction for sale of Small Businesses in Australia.
It’s extremely important you have professional advice from a solicitor, accountant or business broker to help you during the process.
You can buy a business from $15,000 to multi-million dollar companies, so the process will be different. What is important is you conduct proper due diligence so you know exactly what you are committing to and that the business meets your expectations.
3 Key Pieces of Advice to Help You Buy a Business
If this is your first time entering the world of business ownership, you may be wondering where to start. In recent years we have seen a common debate about whether to buy a business or start from scratch. Whilst both have their merits, when you buy a business it’s like you’re 10 steps ahead.
An established business has a number of advantages such as;
- Financial history and projections
- Established products and services
- Experienced team
- Systems
- Marketing strategies
- Lease agreements, potential desirable locations and fit-outs
So when you are looking to buy a business, what exactly should you be aware of? We share 3 key pieces of advice to help guide you.
- Understand Your Return on Investment (ROI)
Basically, how long will it take you to earn back the money you have invested? Obviously for different-sized businesses this number can have a different effect.
ROI is a term that is rarely seen in business for sale ads, though it is becoming more common in recent years. It is also a question worth asking the seller when you look to buy a business, so you know that they have considered your financial input and situation.
Return of investment – the general kind of rule is if the ROI is less than 30%, means the business is in an industry sector e.g. childcare that is in high demand and the business has strong financials and stability. Using childcare as an example, the ROI can range from 2 x net profit in regional areas to as high as 4.5 x net profit in metro area.
Obviously, every business is different. When you buy a business you are buying an entire system, all the assets and liabilities. So it is a big picture to consider.
What an ROI allows you to do, is compare similar businesses for sale. If Business has an ROI of 35% and Business B has an ROI of 22%, why is that?
Whether you are buying a sole trader, partnership or company, how the ROI is calculated may be different. It may be including the owner’s salary, or keeping it separate. So it’s important to have a solid financial understanding and obtain advice from an accountant or business broker.
Another way to look at ROI is in terms of years. An ROI of 25%, will take 4 years to pay back your investment. An ROI of 33% will take 3 years. So it’s good to understand how long it will take to see your money returned. This may be reduced by an upturn in income/net profit by new owners.
- Do the Due Diligence
So many times we hear the story “I have a friend who wants to sell their cafe and they offered it to me. What should I do?”
Well… you should do your due diligence. When buying a business you do not take on the liabilities of the current owner. They remain with the Company/owner selling the business. Only if you are purchasing the Company via share purchase does a buyer take on liabilities. Share transfers are rare for small business sales. There may be some major issues with that cafe that you won’t know about until you do your due diligence.
Due diligence helps you to establish:
- Owners income
- Business structure
- Employee agreements
- Lease and rental agreements (such as property or equipment)
- Contracts
- Financial position
- Suppliers and Customers
- Products and services offered
- Plus more, depending on the business.
- No Matter How Small, Get Advice!
Image: Get advice from a business broker, accountant and solicitor.
It’s one thing to read forums and articles online, it’s another to obtain professional advice for your particular circumstances.
Business Brokers who specialise in buying and selling businesses should be your first point of contact. You want to have a solid understanding of what you are purchasing when you buy a business.
The best way is to speak to a professional, allow them to analyse the business and give you a clear picture of its current situation and future potential.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
What to expect from an Insurance Broker ? When you run your own business you have to work hard at it for 12 months a year. That’s why you need insurance that works just as hard – without taking a break. Murray at Phoenix can assist you to identify the day-to-day risks which your business […]
What to expect from an Insurance Broker ?
When you run your own business you have to work hard at it for 12 months a year. That’s why you need insurance that works just as hard – without taking a break. Murray at Phoenix can assist you to identify the day-to-day risks which your business faces, and help you to decide how to handle and manage those risks which you decide to transfer to insurance. Phoenix will help you find the right insurance solutions for your needs. Here’s what we can do for you over the course of a year.
- Tailoring your strategy
We can carry out a needs analysis to identify potential and existing risks to your business – taking into account any issues over the past 12 months. We do research on insurers to present you with a personalised report recommending the best option.
- Placing cover
We implement your tailored insurance strategy, confirming and communicating the details of your policy and premiums.
- Delivering ongoing service
We can handle the day-to-day management of your insurance cover, holding regular review meetings to make sure you continue to have the right level of protection and recommending changes where necessary to cover any new or emerging risks to your business.
- Managing your claims
If you have a claim, we can support you through the entire claims process – negotiating with insurers and third parties to ensure the swift payment of any benefits. We can maintain up-to-date claims statistics and analysis on your claims frequency, severity, causes and trends so we can get the best outcome for you when it’s time to renew your policy.
- Renewing your cover
As the end of the year approaches, we can review any changes to your business over the course of the year – including any claims you made – and put together
With over 25 years’ experience, and part of the Steadfast Group. Johnson Insurance Brokers Pty Ltd AR 1283293 and Murray Johnson AR 1283294 are Authorised Representatives of Phoenix Insurance Brokers
While insurance is our business, our philosophy is about people and building strong, solid relationships with them. We partner with our clients to achieve the best possible outcomes, for them, their families and their business.
With offices in Como and Busselton, Murray can be contacted on 0418 563 599 / murrayj@phoenixins.com.au
3 Key Pieces of Advice to Help You Buy a Business If this is your first time entering the world of business ownership, you may be wondering where to start. In recent years we have seen a common debate about whether to buy a business or start from scratch. Whilst both have their merits, when […]
3 Key Pieces of Advice to Help You Buy a Business
If this is your first time entering the world of business ownership, you may be wondering where to start. In recent years we have seen a common debate about whether to buy a business or start from scratch. Whilst both have their merits, when you buy a business it’s like you’re 10 steps ahead.
An established business has a number of advantages such as;
- Financial history and projections
- Established products and services
- Experienced team
- Systems
- Marketing strategies
- Lease agreements, potential desirable locations and fit-outs
So when you are looking to buy a business, what exactly should you be aware of? We share 3 key pieces of advice to help guide you.
- Understand Your Return on Investment (ROI)
Basically, how long will it take you to earn back the money you have invested? Obviously for different-sized businesses this number can have a different effect.
ROI is a term that is rarely seen in business for sale ads, though it is becoming more common in recent years. It is also a question worth asking the seller when you look to buy a business, so you know that they have considered your financial input and situation.
Return of investment – the general kind of rule is if the ROI is less than 30%, means the business is in an industry sector e.g. childcare that is in high demand and the business has strong financials and stability. Using childcare as an example, the ROI can range from 2 x net profit in regional areas to as high as 4.5 x net profit in metro area.
Obviously, every business is different. When you buy a business you are buying an entire system, all the assets and liabilities. So it is a big picture to consider.
What an ROI allows you to do, is compare similar businesses for sale. If Business has an ROI of 35% and Business B has an ROI of 22%, why is that?
Whether you are buying a sole trader, partnership or company, how the ROI is calculated may be different. It may be including the owner’s salary, or keeping it separate. So it’s important to have a solid financial understanding and obtain advice from an accountant or business broker.
Another way to look at ROI is in terms of years. An ROI of 25%, will take 4 years to pay back your investment. An ROI of 33% will take 3 years. So it’s good to understand how long it will take to see your money returned. This may be reduced by an upturn in income/net profit by new owners.
- Do the Due Diligence
So many times we hear the story “I have a friend who wants to sell their cafe and they offered it to me. What should I do?”
Well… you should do your due diligence. When buying a business you do not take on the liabilities of the current owner. They remain with the Company/owner selling the business. Only if you are purchasing the Company via share purchase does a buyer take on liabilities. Share transfers are rare for small business sales. There may be some major issues with that cafe that you won’t know about until you do your due diligence.
Due diligence helps you to establish:
- Owners income
- Business structure
- Employee agreements
- Lease and rental agreements (such as property or equipment)
- Contracts
- Financial position
- Suppliers and Customers
- Products and services offered
- Plus more, depending on the business.
- No Matter How Small, Get Advice!
Image: Get advice from a business broker, accountant and solicitor.
It’s one thing to read forums and articles online, it’s another to obtain professional advice for your particular circumstances.
Business Brokers who specialise in buying and selling businesses should be your first point of contact. You want to have a solid understanding of what you are purchasing when you buy a business.
The best way is to speak to a professional, allow them to analyse the business and give you a clear picture of its current situation and future potential.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
SEEK Business is the number one site for Business enquiries. Advance Business Brokers subscribes to this site to ensure our clients receive the best possible coverage across multiple sites when selling their business. Many business brokers do not subscribe to Seek Business due to the high monthly cost. When investigating brokers’ when it is time […]
SEEK Business is the number one site for Business enquiries. Advance Business Brokers subscribes to this site to ensure our clients receive the best possible coverage across multiple sites when selling their business.
Many business brokers do not subscribe to Seek Business due to the high monthly cost. When investigating brokers’ when it is time to sell your business, ask if they subscribe to Seek Business.
How to grow your business with quality buyers
Despite the increasingly challenging economic conditions for small businesses and households, buyer engagement on SEEK Business remains at record highs (and continues to grow).
In FY22, traffic to SEEK Business grew by 8% year-on-year, while enquiries increased by 9%*. In July 2022, we had a record month of enquiries (24% up on July 2021).
This creates an opportunity for brokers and franchisors who are willing to take it, as it suggests more Australians are seeking to take control of their careers and their futures through business ownership.
We also believe that the pandemic has accelerated the ambition of business buyers who are motivated by the desire to create a legacy, work in something they’re passionate about, and build a financially secure future for themselves and their families.**
Where is buyer demand for businesses highest?
In FY22, demand for businesses for sale came primarily from Victoria, Queensland, and Western Australia. New South Wales was the only state to see a decline in enquiries (-3% compared to FY21), but this was off the back of significant growth since FY19 (+45%).
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
Off track It is a term which can be and has been applied in recent times to an increasing number of “respected” leaders from a range of disciples, sectors and professions. The trust and confidence assigned to nominated and widely accepted leaders have been shaken, in some instances, to their very core. Look no further […]
Off track
It is a term which can be and has been applied in recent times to an increasing number of “respected” leaders from a range of disciples, sectors and professions.
The trust and confidence assigned to nominated and widely accepted leaders have been shaken, in some instances, to their very core.
Look no further than at the higher echelons of the Reserve Bank in Australia. Earlier this year the Governor declared interest rates were not expected to be raised until possibly 2024. Since that time there have been three increases in the official interest rates, taking them from 0.1% to 1.35%. That is a stimulatory rate. And, in all probability there are more to come in the next 12 months. An official neutral interest rate of 3% is possible.
A case of inflated reality overwhelming deflated leader-led projections.
Likewise, leaders of start-up businesses in buy-now, pay-later and neo banking have learnt many fundamental financial and strategic lessons. A lot of their initial investors have lost interest and a lot of money.
In the words of Jeff Bezos, founder of Amazon, lie some pearls of wisdom:
Think Big. Fail Fast. Move On.
Remember always that success is typically relative, and like fame, can be fleeting.
Countless established, start-up and greenfields fin-tech and technology operation leaders have been brought back to reality during 2022.
So, all leaders do not necessarily have all the answers and strikingly accurate foresights.
And do not be tempted to contend that what is needed most is resilience. That implies a return to an original state, which may not be the intended destination.
CONCLUDING COMMENTS
No-one need consider themselves to be on their own. However, falling in-line behind a preferred leader is not necessarily on track to fame and fortune.
Source:
Barry Urquhart
Managing Director
Marketing Focus
M: 041 983 5555
E: Urquhart@marketingfocus.net.au
W: www.marketingfocus.net.au
The more prepared you are, the better the outcome will be – both for you and your business. This tax checklist will help you break down the task into manageable portions: Multiple Businesses under same Entity When a business owner wants to sell a business and operates more than one business under the same entity, […]
The more prepared you are, the better the outcome will be – both for you and your business.
This tax checklist will help you break down the task into manageable portions:
Multiple Businesses under same Entity
When a business owner wants to sell a business and operates more than one business under the same entity, it is imperative that separate accounts are available for each of the business streams/locations. This includes profit & loss statements solely relating to the income and expenses of each location along with separate balance sheets for each location.
Business sales can fall over when the accounts are not easily decipherable for buyers/accountants/finance brokers and valuers.
The individual accounts must also match back to the Company tax returns. If business owners do not have their accounts set up correctly now, at the start of the tax year is a good time to start.
Good record keeping
Your tax position is only as good as the records you keep.
Lots of business owners still do their tax and recordkeeping on paper. Yes, it saves you paying for and learning to use digital software. But at what cost? It’s so easy to lose paper records. And printed receipts on that glossy paper quickly fade.
No record means you’re not able to accurately track your GST, your deductions, even your depreciation. Those losses in unclaimed credits and refunds could wind up costing you far more than the price of the software.
Budget review
The federal Budget unveiled a number of measures for small businesses. Be sure you know the latest measures and what you are entitled to, as your tax situation could have changed significantly.
Also consider your own position under the low- and middle-income tax offset – depending on how much you earn, it may be wise to postpone or bring forward your own pay to a different tax year to meet the eligibility requirements.
Deductions ready to claim
This sounds self-explanatory – but you’d be surprised just how many deductions go unclaimed. Many of these fall into two types: small expenses and depreciation.
People often think small expenses – e.g., a coffee meeting with customers, a few stationery items here and there – aren’t worth bothering about. But they quickly add up! If it’s a legitimate business expense, it can be claimed. Would you rather you keep those funds or the tax office?
Meanwhile depreciation is complex and often gets overlooked because busy business people aren’t sure what they’re entitled to claim. Company vehicles, computers and other electronics are the most obvious. But think more widely about your business assets – office furniture, air-conditioning, the fit-out of your business premises and so on.
And if you obtain professional financial advice, you may be able to claim that too!
Employee entitlements up to date
The hustle and bustle of everyday life in business may mean you have some employee entitlements to catch up on.
Superannuation Guarantee (GS) contributions is the first point of order – you may accrue penalties if this goes unpaid. Things get messy if they are overdue once we cross into a new financial year. And tax time is also when employees are most likely to look at their super and notice missed payments. So be sure this is up to date.
Check in too on other entitlements while you’re at it – annual leave and long service etc. – to ensure you have those covered.
Sales splurge avoided
Consider whether you actually need it.
Buying stuff you don’t need just for the tax deduction is like buying a car because it looks good – it’s an unnecessary expense, depreciates in value, and you have to find somewhere to store it. Eventually, you may need to sell it (likely at a loss) to get that all-important space back.
Self-entitlements sorted
Don’t forget to look after yourself too.
Are you paying yourself properly? Do you have outstanding director loans? Have your expenses been divided between business and personal?
Remember to claim your home-based work expenses – such as a dedicated home office from where you do your accounting/strategy/social media/other work activities.
And have you paid yourself superannuation? Other employees receive 10 per cent in super on top of their salaries… you are entitled to this as well.
The old line “the business is my retirement fund” is a huge personal risk, so consider diversifying your retirement assets and extracting your superannuation out of the business. It’s far easier to manage in smaller, regular amounts with the pay cycle than a big lump sum. Plus, you’ll have longer to benefit from the compound growth!
Before you consider buying a business, there are some key steps to take in order to know exactly what you’re getting into. Buying an existing business can be an effective way to skip the start-up stage and hit the ground running as your own boss. Once you’ve found a business you’re interested in, it’s important […]
Before you consider buying a business, there are some key steps to take in order to know exactly what you’re getting into.
Buying an existing business can be an effective way to skip the start-up stage and hit the ground running as your own boss.
Once you’ve found a business you’re interested in, it’s important to check its financial health thoroughly. Completing this checklist can help you get a clearer picture of your potential business’ prospects.
- Financial statements
- Review balance sheets, profit and loss statements, annual reports and any cash-flow statements for at least the past two years. You can do this with your accountant.
- Verify the numbers against independent evidence, such as sales records, invoices, bank statements and loan documents.
Questions to ask
- Are there new or increased costs you should anticipate?
- Are there any cash flow or debtor problems?
If the current owner isn’t willing to provide these details, it’s important to know why.
- Tax records
- Check business activity statements (BAS) and reconcile the taxable income and profits with the business’ financial statements
- Check payroll tax records (if applicable). The PAYG (pay-as-you-go income tax), GST and other tax obligations, such as payroll tax, should all be up to date.
- Check stamp duty records (if applicable). Will the purchase of the business be GST-free and approximately how much stamp duty will you have to pay?
No matter how good you are at numbers, you’ll probably want an accountant to go over these details with you, so you can be sure nothing is missing.
- Assets
It’s essential to make sure that the assets listed in the books match what exists within the business and that value isn’t being overestimated.
- Ask for an asset list and check off physical items against it
- Do a stocktake to assess the inventory on hand and its value
- Inspect and verify that all plant, equipment, fixtures and fittings are in good working order
- Check assets are insured until settlement of purchase
- If assets are leased, get copies of the leases
- If inventory has been sitting in the business for a long time, ask why. It could prove difficult to shift down the line if customers aren’t interested.
- If you don’t understand how an asset works, ask the owner or someone else who may have experience with it.
- Customers and suppliers
- Get a list or database of key customers
- Check sales contracts to see what future business is guaranteed
- Check if any major contracts are about to expire
- Get details of suppliers and find out what the conditions of trade may be
- If possible, get feedback from customers and suppliers on the business.
- Reason behind sale
Investigate the reasons for the sale and try to understand what the current owner’s motives may be by asking:
- How long has the owner operated the business?
- How long has it been on the market?
- How many offers have been made?
- What’s the owner planning to do next?
- Legal rights and obligations
- Review government regulations that apply to the business to ensure it has the relevant permits and licences it needs to operate
- Check if any worker entitlements need to be made, including leave entitlements or compulsory superannuation
- Check whether workers’ compensation premiums are up to date
- Check if intellectual property is protected through licences, patents, trademarks and registrations and if these rights will be passed on with the sale
- Check the lease and any agreements binding the business and ask for copies. Questions to ask about the lease: Is there a right to renew on the lease and can you exercise that option? If there isn’t a right to renew, could you find another suitable location?
- Check the Australian Securities and Investments Commission (ASIC) website for company details
- Contact your state or territory consumer affairs agency for a record of any unscrupulous trading
- Check the Australasian Legal Information Institute website to see if the current business owner has ever been taken to court
- Ensure the vendor puts all agreements in writing and keep your copies of correspondence and statements.
- Competitors
You can get some of this information from industry associations, government departments and the Australian Bureau of Statistics, or seek specialist advice from industry bodies, consultants and business brokers.
- Investigate your prospective competitors. Look at their growth, strengths, weaknesses and threat to you. If you can, get the data to compare their profitability, earnings, prices and costs.
- List any potential threats. You can check with the local council to see if new competitors are planning to start up.
- Research industry trends. Is the sector growing or slowing? What are the profit margins?
- Consider economic factors. If the economy slows down, how will this affect your business?
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
There is one resource that we are all given equally: time. What you do with yours in business can be the difference between success, failure, or plain old mediocrity. Many business owners decry a lack of resources to grow, chief among them being time. Whilst it is easily received, time is devilish to manage. When […]
There is one resource that we are all given equally: time. What you do with yours in business can be the difference between success, failure, or plain old mediocrity.
Many business owners decry a lack of resources to grow, chief among them being time. Whilst it is easily received, time is devilish to manage.
When many buyers transition to self-employment, they have been effectively “institutionalised” by former employment: they come to miss the corporate framework that gave structure to their workday. Despite the fact this structure was one of the factors they had longed to escape!
The wide-open spaces of business ownership may give the appearance of freedom. What this grass-is-greener vision doesn’t convey, however, is that there is no escaping the responsibility of business ownership when pay day and monthly bills fall due.
Back to basics
Getting the basics right is key to ensuring your time is spent wisely and productively:
- Goal-setting: Managing time requires setting goals. The more time spent on a task, most likely, the more output. If nothing else, at least time working for the business is time invested in the business.
- Efficiency: An honest assessment of skills is a great place to start. What are you the business owner really good at? Maybe a skill that requires years to acquire is the essence of the business plan.
- Analysis: The concept of skills as an asset sometimes gives business owners a license to work overtime. They do so because no analysis has been made of what the business really is – a service company undertaking a task that could in part be delegated to a lesser-skilled person.
- Big picture view: This could be the first step to freeing up the business owner to expand the business. A complete review of the business plan may reveal that rather than being on the tools, the business owner is best placed to sell the service and also has the skills to train others to undertake lesser-skilled tasks.
Know your Business
“The customer is always right” is a phrase pioneered by Harry Gordon Selfridge, John Wanamaker and Marshall Field in around 1905: “Every one of their thousands of employees are instructed to satisfy the customer regardless of whether the customer is right or wrong.”
The customer always wins the argument. They can silently vote with their feet. As such, time spent learning how your relationship is perceived by your customers is time truly invested.
A single customer inclined – or better still, enabled – to give repeat business is an asset. The person with the most to gain from good customer experience is the business owner.
Take time to mystery shop your own business. Ring and ask for service. If the response is not as you would wish, invest more time in improving how your company appears to the community. It is perhaps the best time investment for any business owner.
Would you buy your business?
Presenting your business for sale to yourself can deliver a rude shock. All those things that need fixing; the professional appearance (or lack thereof); what could be improved if only you had the time.
Step back and critique your overall operation. Compare it to not only your direct competition but to other businesses too.
This will take time, but the rewards may well be that your business looks and feels better than the competition. Your customers and staff will notice. As will any prospective future buyer.
Time is money
What is the most valuable asset the business owner has to invest to generate the maximum return? Time.
“Time is money,” as Benjamin Franklin reportedly espoused in 1748. Yet similar quotes date back at least the 5th Century BCE, when Greek biographer Plutarch described time as the “most costly outlay”.
Another short but powerful quote that should ring in the ears of every business owner is “business is business”, paraphrased from US President Calvin Coolidge (1923-29).
When undertaking any time commitment, ask yourself: Is this an investment or a waste of time? Will it assist the business?
Devote your time and effort to where it will bring the most rewards and the rest will follow. As Hollywood executive Samuel Goldwyn once said, “the harder I work, the luckier I get”.
Keeping your employees happy and ensuring they feel supported to grow in the organisation is essential to the success of your company. Employee retention, productivity and your company’s reputation can hang in the balance. Any CFO worth their salt knows that if you are not keeping employees happy, you will lose them. Likewise, if an […]
Keeping your employees happy and ensuring they feel supported to grow in the organisation is essential to the success of your company.
Employee retention, productivity and your company’s reputation can hang in the balance. Any CFO worth their salt knows that if you are not keeping employees happy, you will lose them. Likewise, if an employee is not feeling appreciated or challenged by their role, they will become complacent resulting in a loss of productivity and general morale.
This discontent can spread through the company, ravaging a once healthy work culture, and breeding a general dislike of and disenfranchisement with the company.
That is why it’s essential to support your employee’s growth and create an environment where they can thrive. Try these ways to support your employee’s professional development.
- Recognition
- Incentive programme tailored to the employee
- Constructive feedback
- Adapt your management style their learning style
- Try software learning management systems
- Organise a mentoring program
- Make time for their upskilling
- Taylor the role to the employee not the other way around
Recognition
Everyone needs to feel that their work is appreciated, and your employees are no exception. Say you have a motivated, hard-working employee who stays late and comes in early going above and beyond to get the job done.
If you are not acknowledging the extra work that employee is putting in, they will stop going the extra mile very quickly. The employee is going to start to feel as though they’re being taken advantage of, as if no-one appreciates the extra effort they put in and they are going to start to wonder why they do it at all. This can lead them to looking for another more fulfilling role or just becoming complacent.
A simple thank you, or an email acknowledging the extra work they have done, offering a day in lieu if you know they’ve done a lot of extra hours or praising their work in the company newsletter can really go a long way to shifting their perception on the situation. From ‘I’m being taken advantage of by the company’ to ‘I do important work that makes a difference to the company, and I am appreciated for it.’
Incentive Programmes
Programmes can be tailored to an employee’s job criteria and linked to their pay structure. This provides both a reward mechanism, structure for future development and means of assessing in conjunction with the appraisal process.
Constructive feedback
Similarly, if you have an employee working hard and they’re just not quite getting the job done the way they need to, providing constructive feedback can make all the difference.
Constructive feedback can be difficult to navigate while maintaining an employee’s morale. If given incorrectly you can demotivate an employee rather motivate them.
Try the sandwich approach. This is a technique where you sandwich the piece of constructive feedback between two positive performance notes you want to give. This helps the employee to feel as though they are not doing everything wrong but just have something to work on.
And remember to keep constructive feedback constructive. By that we mean provide actionable feedback that will improve their performance. Be clear about what can be improved and if applicable offer resources to help your employee learn. Constructive feedback coupled with access to additional mentoring or learning resources will help them feel supported to succeed.
Adapt your management style
You should be adapting your management style to your individual employee’s learning style. If you have an employee who is a visual learner, you’re not going to get through to them with lengthy documents about a project. However, graphs and a visual presentation might help them to understand what the project goals and plans are.
Obviously, this isn’t something you can do all the time but when dealing with specific employees and training them, it can be helpful to adapt your style. This will ensure that your employee gets the most from your meetings and training sessions and feels individually supported.
Try an LMS
An LMS or a Learning Management System can be a real game-changer for your company’s professional development program. These systems can be installed software or web-based applications and they can be used to monitor and track learnings for your staff.
It can take the pressure off your HR department by automating some of the administration and data entry involved. It gives your employees the ability to take responsibility for their study and complete it in their own time frames. You can learn more about different LMS systems here.
Organise a mentoring program
It can be in house, or you can set an employee up with an external mentorship program but encouraging employees to engage in mentoring programs shows you are invested in their future and their professional growth.
Mentorship programs have a number of benefits for your company and your employees. They help employees to gain confidence, and refine their career path, while providing a helpful outsider perspective to their day-to-day operations.
Mentoring staff can be great for your higher-level employees as well. It helps to build and refine their leadership skills; it can build out their professional network and elevate their professional standing in the industry.
Make space for their Upskilling
It’s not much use telling employees you want them to grow in the company and pursue professional development and then not giving them the time and space to do that.
Facilitate your employee’s professional development programs by offering them allotted time each month for PD. Open a dialogue with them and ask them directly what they need to complete their professional development activities and work with them to set them up to succeed. Employers should place great importance on their employees learning and development.
Tailor the role to employee, not the employee to the role
Your people are your most valuable assets. They make or break your business. So, cultivate employees that love to work with the company, that are passionate about the work you all do and want to do better every time.
Treat your employees as people. Talk to them about their hopes and dreams, their passions and plans and find a way to make their role more rewarding for them. If they are passionate about data analysis and currently work in administration, help them to achieve their career goals by organising professional development courses in data analysis and giving them more data related tasks in their role.
Your employees are going to give 110% if you offer them the chance to do work that they find meaningful and that supports their overall career goals.
When applying for a business loan, there are a number of documents you may be asked to provide, including financial statements, proof of income, identification and more. A business loan or overdraft could help you make your next purchase, manage your cash flow or expand your business. When applying for business finance, you (and any […]
When applying for a business loan, there are a number of documents you may be asked to provide, including financial statements, proof of income, identification and more.
A business loan or overdraft could help you make your next purchase, manage your cash flow or expand your business.
When applying for business finance, you (and any directors, partners or guarantors) may be asked to provide:
- Financial statements, preferably prepared by an accountant
- Proof of individual income
- Bank statements
- Identification
- A few extra things if you’re a start-up business
These documents can help your financial provider understand your business’ financial situation.
There are different types of business funding you can apply for, including business loans, overdrafts and credit cards. If you’re applying for asset finance, you may need to show extra information.
Financial statements
Your financial statements will show your asset, liability and net worth positions, as well as your income and expenses that will be used to determine if you can meet your existing and proposed repayments.
Your financial statements will generally consist of a balance sheet and income statement. They may also include a statement of cash flow.
You may also be asked for your latest tax returns, business activity statements (BAS) or print-outs of statements from your Australian Taxation Office (ATO) portal. If there are any trusts or self-managed super funds (SMSFs) related to your business, you may need to provide additional documents,
Proof of individual income
Lenders will also want to know your personal income if you’re a director and/or shareholder of a company. You’re likely to be asked for your two most recent individual tax returns and an ATO Notice of Assessment.
If you earn other income unrelated to your business, you may want to provide this information as well. For example, you could bring a rental statement if you own an investment property.
Bank statements
So that the lender can obtain a complete picture of your financial position, they often ask that you provide details of your personal and business income, savings and liabilities, such as loans and credit cards that you might have with other financial institutions.
You’ll also need to bring your latest bank statements – either paper or electronic copies are fine. If anyone is guaranteeing the loan, they will also need to provide this information.
Identification
If you’re applying for a loan with a lender where you’re an existing customer, you most likely won’t need to complete this step.
If you’re a new customer, you’ll need to provide identification such as your driver licence or passport. The documents needed will vary depending on your business structure – you may also need to bring in your trust deed or partnership agreement or company registration, if applicable.
A few extra things for start-ups
If you’re yet to start your business or have recently started trading and don’t have 12 months of trading history, there are a few extra things you may need to provide, including:
- Cash-flow projections
- Business plan
- Business contract of sale
- Lease agreement
Source: https://www.commbank.com.au/articles/business/information-for-business-loan.html
Keeping your employees happy and ensuring they feel supported to grow in the organisation is essential to the success of your company. Employee retention, productivity and your company’s reputation can hang in the balance. Any CFO worth their salt knows that if you are not keeping employees happy, you will lose them. Likewise, if an […]
Keeping your employees happy and ensuring they feel supported to grow in the organisation is essential to the success of your company. Employee retention, productivity and your company’s reputation can hang in the balance. Any CFO worth their salt knows that if you are not keeping employees happy, you will lose them. Likewise, if an employee is not feeling appreciated or challenged by their role, they will become complacent resulting in a loss of productivity and general morale. This discontent can spread through the company, ravaging a once healthy work culture, and breeding a general dislike of and disenfranchisement with the company. That is why it’s essential to support your employee’s growth and create an environment where they can thrive. Try these seven ways to support your employee’s professional development.
1. Recognition
2. Constructive feedback
3. Adapt your management style their learning style
4. Try an LMS
5. Organise a mentoring program
6. Make space their upskilling
7. Taylor the role to the employee not the other way around
Recognition
Everyone needs to feel that their work is appreciated, and your employees are no exception. Say you have a motivated, hard-working employee who stays late and comes in early going above and beyond to get the job done. If you are not acknowledging the extra work that employee is putting in, they will stop going the extra mile very quickly. The employee is going to start to feel as though they’re being taken advantage of, as if no-one appreciates the extra effort they put in and they are going to start to wonder why they do it at all. This can lead them to looking for another more fulfilling role or just becoming complacent.
A simple thank you, or an email acknowledging the extra work they have done, offering a day in lieu if you know they’ve done a lot of extra hours or praising their work in the company newsletter can really go a long way to shifting their perception on the situation. From ‘I’m being taken advantage of by the company’ to ‘I do important work that makes a difference to the company, and I am appreciated for it.’
Constructive feedback
Similarly, if you have an employee working hard and they’re just not quite getting the job done the way they need to, providing constructive feedback can make all the difference. Constructive feedback can be difficult to navigate while maintaining an employee’s morale. If given incorrectly you can demotivate an employee rather motivate them.
Try the sandwich approach. This is a technique where you sandwich the piece of constructive feedback between two positive performance notes you want to give. This helps the employee to feel as though they are not doing everything wrong but just have something to work on. And remember to keep constructive feedback constructive. By that we mean provide actionable feedback that will improve their performance. Be clear about what can be improved and if applicable offer resources to help your employee learn. Constructive feedback coupled with access to additional mentoring or learning resources will help them feel supported to succeed. You should be adapting your management style to your individual employee’s learning style. If you have an employee who is a visual learner, you’re not going to get through to them with lengthy documents about project. However, graphs and a visual presentation might help them to understand what the project goals and plans are.
Obviously, this isn’t something you can do all the time but when dealing with specific employees and training them, it can be helpful to adapt your style. This will ensure that your employee gets the most from your meetings and training sessions and feels individually supported.
Try an LMS
An LMS or a Learning Management System can be a real game-changer for your company’s professional development program. These systems can be installed software or web-based applications and they can be used to monitor and track learnings for your staff. It can take the pressure off your HR department by automating some of the administration and data entry involved. It gives your employees the ability to take responsibility for their study and complete it in their own time frames. You can learn more about different LMS systems here.
Organise a mentoring program
It can be in house, or you can set an employee up with an external mentorship program but encouraging employees to engage in mentoring programs shows you are invested in their future and their professional growth. Mentorship programs have a number of benefits for your company and your employees. They help employees to gain confidence, and refine their career path, while providing a helpful outsider perspective to their day-to-day operations. Mentoring staff can be great for your higher-level employees as well. It helps to build and refine their leadership skills; it can build out their professional network and elevate their professional standing in the industry. Make space for their Upskilling
It’s not much use telling employees you want them to grow in the company and pursue professional development and then not giving them the time and space to do that. Facilitate your employee’s professional development programs by offering them allotted time each month for PD. Open a dialogue with them and ask them directly what they need to complete their professional development activities and work with them to set them up to succeed. Employers should place great importance on their employees learning and development.
Tailor the role to employee, not the employee to the role
Your people are your most valuable assets. They make or break your business. So, cultivate employees that love to work with the company, that are passionate about the work you all do and want to do better every time. Treat your employees as people. Talk to them about their hopes and dreams, their passions and plans and find a way to make their role more rewarding for them. If they are passionate about data analysis and currently work in administration, help them to achieve their career goals by organising professional development courses in data analysis and giving them more data related tasks in their role. Your employees are going to give 110% if you offer them the chance to do work that they find meaningful and that supports their overall career goals.
Source : BSALE
Industry research demonstrates that buying an established profitable business (small or large) will reduce business ownership failure by over 50% when compared to starting a new business. Why Buy an Existing Business? When it comes to building a successful business, many entrepreneurs opt to purchase an existing business—and there are a variety of excellent reasons […]
Industry research demonstrates that buying an established profitable business (small or large) will reduce business ownership failure by over 50% when compared to starting a new business.
Why Buy an Existing Business?
When it comes to building a successful business, many entrepreneurs opt to purchase an existing business—and there are a variety of excellent reasons to do so. Not only does it mean you can see how your new venture is performing prior to buying it, but you also eliminate many of the risks associated with start-up businesses.
There are numerous advantages to buying an existing business, including:
- Immediate Cash Flow from the Business
- A Business with Experienced Employees
- Seller Training comes with the Business
- A Business with Established Business Operating Systems
- Established Customer Base and Referral Business
- A Business with Established Suppliers and Credit
- The Business enables financing
Making The Right Connections – Advance Business Brokers are experts in the sale of Childcare centre business and properties. Our huge database of buyers extends internationally.
Buyers requiring assistance with childcare application processes will be assisted all along the way when they purchase with Advance Business Brokers.
Understanding the Best Time to Sell Your Business Your business should always be ready to sell. Preparation is the key to a great outcome. A business buyer can come knocking on your door at any time and you need to know a fair market price for your business so you can properly consider an offer. […]
Understanding the Best Time to Sell Your Business
Your business should always be ready to sell. Preparation is the key to a great outcome.
A business buyer can come knocking on your door at any time and you need to know a fair market price for your business so you can properly consider an offer. It’s equally important to understand the factors behind this fair market price to enable you to take measures to improve your enterprise value.
Ideally, most small to medium-sized businesses should begin to prepare their business for sale one to two years prior to putting the business on the market and this period may be longer for large enterprises. In this way, you can prepare and make your investment and financial decisions with the upcoming sale in mind.
Owners can significantly impact the price achieved upon sale by careful planning. A rushed or anxious seller will nearly always get less for their business.
Selling your business should form part of your business strategy. Your strategy may dictate that the time may be right to sell when you have achieved your business goals, such as:
- Achieving a certain age to continue to manage the business. E.g., retirement.
- Achieving a certain Business Enterprise Value and introducing investors and partners.
- Other business, commercial or personal interests become a priority. E.g., career change, other business opportunities or relocation.
Whilst a successfully planned exit strategy is often achieved, many businesses are also presented to market unplanned, such as:
- Partnership dispute
- Owner is ‘burnt-out’
- Low profitability.
Understanding the best time to sell and a well-planned exit strategy will always yield much better results.
Establish your Reasons for Selling
Among the first questions asked by a purchaser is, “why are they selling?”
There are many reasons for wanting to place your business on the market. The potential buyer will find your reasons for selling very compelling and will want to know that they are legitimate.
In fact, many buyers will also be trying to assess your urgency for selling. They will try to use this information in negotiations, looking to take advantage of any desire to exit quickly.
Some of these reasons may include;
Burn-out
Starting and growing a business takes hard work and dedication. Sometimes just as the business is becoming successful and the profits rolling in, the owners become a little worn out. Rather than letting things deteriorate, it may be time to sell the business.
Keep in mind that it is easier to sell a business with rising revenue and profits – if you can feel your energy as an owner slipping it may be better to act sooner rather than later. A good test is to take a short holiday and gauge your enthusiasm for the business on your return. If you aren’t returning with new energy and ideas burn-out is a real possibility. If you can’t take a holiday in the first-place burn-out is almost inevitable.
Technology Change
Some business owners find themselves wanting to sell because they are unable to understand or fully take advantage of a new technology. Perhaps a new owner, with these new world skills could take the business to the next level e.g. implement e-commerce.
Partnership Disputes
You may have gone through a divorce or have a dispute with a business partner which has made it difficult to continue with the business. Partnership disputes may not be hostile, it could be as simple as an inability to agree on the strategic direction of the business. Sometimes the best resolution for this is to sell the existing business and for both partners to restart/buy a more suitable business.
Lack of Investment Capital
There are times in a business’s lifecycle when it needs investment capital to take advantage of new opportunities. Some owners are not able to invest further in the business and give it what it needs to prosper.
Retirement
Many business owners hold off selling a business for retirement just a few years too long. Keep in mind it can take longer than 6 months to sell a business and remember that it is harder to sell a business with declining revenue. If you feel yourself starting to “take your foot off the pedal” it may be worth bringing forward taking your business to market to realise its full value.
Circumstances have changed
Sometimes circumstances such as the birth of a child, illness, death, the need for family support, make running a business more difficult or just not possible. This is hard to plan for, however, an empathetic business broker should be able to assist prepare the business for a timely sale.
Poor Performance
A poor performing business can be a drain on its owners. If you’re looking to exit because the business is not meeting your expectations, then you need to appreciate any new buyer will need to have confidence that they can turn it around.
When you have achieved your business goals under your management
Sometimes you just know the time is right for you to exit based on goals you established earlier in your business journey.
The good news
Throughout the process of preparing your business for sale, there is considerable support available to you. A dedicated business broker will help you understand the fair market price for your business and advise you on how to maximise this value. They can work with your accountant, business partners and your key staff to ensure all stakeholders clearly understand why the business is selling.
Contact Angela at Advance Business Brokers (AU).
Industry research demonstrates that buying an established profitable business or franchise (small or large) will reduce business ownership failure by over 50% when compared to starting a new business. Why Buy an Existing Business? When it comes to building a successful business, many entrepreneurs opt to purchase an existing business—and there are a variety […]
Industry research demonstrates that buying an established profitable business or franchise (small or large) will reduce business ownership failure by over 50% when compared to starting a new business.
Why Buy an Existing Business?
When it comes to building a successful business, many entrepreneurs opt to purchase an existing business—and there are a variety of excellent reasons to do so. Not only does it mean you can see how your new venture is performing prior to buying it, but you also eliminate many of the risks associated with start-up businesses.
There are numerous advantages to buying an existing business, including:
- Immediate Cash Flow from the Business
- Set up establishment issues been resolved
- A Business with Experienced Employees
- Seller Training comes with the Business
- A Business with Established Business Operating Systems
- Established Customer Base and Referral Business
- A Business with Established Suppliers and Credit
- The Business enables Ease Accessing Financing
- Finance more likely to be an option
- Training – hand-over by an experienced operator
- Regulatory approvals already in place
In times of rapid change projection and reflection are difficult, subjective and often require refinement and filtering. Concerted and extended externally applied intrusions and influence by governments create artificial reality, distant from the creeping presence of technology, algorithms and AI (artificial intelligence). All of which make New Year resolutions and updates of business plans somewhat […]
In times of rapid change projection and reflection are difficult, subjective and often require refinement and filtering.
Concerted and extended externally applied intrusions and influence by governments create artificial reality, distant from the creeping presence of technology, algorithms and AI (artificial intelligence). All of which make New Year resolutions and updates of business plans somewhat marginal, meaningless and, possibly, futile.
Planning for, and marshalling the resources for life- and business- plans remain important. Both should be considered indicative rather than definitive.
Therefore, emphasise the NOW – the present. De-clutter the mind of what was and could be. Simply be purposeful and focused.
Peak performance can be rewarding, but fleeting.
Hence:
Carpe diem
That is, seize the day. One day at a time.
Source: Roman poet Horace – 2000 years ago.
Source:
Barry Urquhart
Managing Director
Marketing Focus
M: 041 983 5555
E: Urquhart@marketingfocus.net.au
W: www.marketingfocus.net.au
LIFE-BALANCE Living with and operating in an environment affected by coronavirus has emphasised the importance and positive nature of life-balance. Incidences of stress, depression, counselling by psychologists and psychiatrists, increased absenteeism and falling morale, have substantially broadened. Self-worth is, and should be valued above all other measures. Working harder and longer is inextricably associated with […]
LIFE-BALANCE
Living with and operating in an environment affected by coronavirus has emphasised the importance and positive nature of life-balance. Incidences of stress, depression, counselling by psychologists and psychiatrists, increased absenteeism and falling morale, have substantially broadened. Self-worth is, and should be valued above all other measures.
Working harder and longer is inextricably associated with pandemic-fatigue. There must be a better way.
Cost: benefit analyses, task prioritising, delegation, disciplined planning, celebrating achievements and taking the time to provide “space” for all are best categorised as imperatives, rather than as opportunities.
Determining opportunities, costs and ranking activities are complemented with the discipline of identifying and determining what needs to be stopped and possibly deleted. Taking the time to do so can, and will be rewarded with more available free-time.
Leadership should be recognised, respected and valued.
Source:
Barry Urquhart
Managing Director
Marketing Focus
M: 041 983 5555
E: Urquhart@marketingfocus.net.au
W: www.marketingfocus.net.au
When applying for a business loan, it’s essential to prepare a detailed business plan and fully inform the lender about your proposed venture. This information helps the lender to provide you with the right type of finance and advice. Decisions to make Deciding that your business needs a loan is only the first step. There […]
When applying for a business loan, it’s essential to prepare a detailed business plan and fully inform the lender about your proposed venture. This information helps the lender to provide you with the right type of finance and advice.
Decisions to make
Deciding that your business needs a loan is only the first step. There are a number of things to consider before you approach a lender; how much do you need to borrow; what type of loan will you need; how long will you need it for; can the business afford to repay the loan, interest and any one-off or ongoing fees that come with the loan; what security can you offer the lender and how this affects the interest rate offered. Take the following into account:
- Access to funds you borrow
If you need to access the funds on a semi-regular basis (i.e. to help with cash flow to keep the business operating while waiting for your customers to pay for goods etc.), ‘at call’ loans such as an overdraft or line of credit are designed for this purpose. However, if you need the funds to buy a new business or equipment etc. to expand your existing business you will need the funds ‘upfront’. This is also known as a ‘fully drawn advance’ and provides you with the entire loan amount all at once.
- Loan terms
Loans provided upfront will need a portion of the loan plus interest paid back at regular intervals. The repayment amount will depend on the term or length of the loan. To determine the loan term suitable for your business you will need to calculate how much you can afford to service the loan. Be aware that the longer the loan term the more total interest you will pay. Loans that are at call have no fixed terms.
- Ongoing funding
This is the average amount of an overdraft or line of credit that is used at any one time. E.g. You may wish to have an overdraft limit of $20,000 to provide money for the occasional big expense, but usually, you won’t use more than $5000 of that credit limit on average. So in this case $5,000 is the level of ongoing funding you need.
When applying for an overdraft limit, things to watch out for are:
The higher the overdraft amount higher the fees
Clauses where the lender can demand repayment of the whole loan at any time.
- Fixed or variable interest rate
The choice of the rate will affect the stability of repayments, the overall cost of the loan and the loan features available. With a fixed-rate loan, the lender bears the risk of interest rate moves, while with a variable rate you will bear this risk. Ultimately, the choice of variable or fixed rates will depend upon how much free cash flow your business generates after you have paid all your expenses, including loan repayments. If your business has a low-profit level, a variable rate loan repayment may rise beyond your ability to pay.
- Loan security
Loans can be secured or unsecured by various types of assets, including residential, commercial, rural property or business assets. Alternatively, some loans are unsecured by any asset. Generally, the less you provide for security the higher the interest rate will be. Be aware the lender has the legal right to seize any property or asset you offer as security if you can’t repay a loan on time.
- Fees
There can be fees that can make a loan less attractive than it first seems. These include one-off fees such as establishment/application fees, exit/discharge fees and early termination fees or regular fees such as service fees or line/credit advance fees. Be sure to investigate the cost of set-up and ongoing fees in the average monthly repayment to give you a better idea of the true cost of the loan.
Seek advice
The information provided here will provide you with a range of possible finance options. It is important to seek advice from your accountant or business advisers before approaching a lender for a loan.
Plan the business, plan the finance
Lenders will ask for a lot of in-depth information about the financial history of the business. It’s also important for you to create a convincing and detailed business plan which should include a profit and loss budget and cash flow forecast. The information you use to build your business plan may also be needed by the lender to assess your project. This includes both the past and future plans for your business, the people working in it and the market itself.
Applying for business loan
A projection of the cash requirements of the business is most important to a lender, as it is the actual cash left after expenses
Risk assessment
Understanding what lenders look for and what they consider risky will help you present your business in a favourable manner.
As a general rule, lenders look for:
- the level and nature of your security (what you’re offering to give them if you can’t repay the loan)
- your ability to make regular loan repayments (cash flow risk)
- your ability to ultimately repay the debt (business risk), including any other debts you might already have.
You need to be able to assess the level of cash flow or business risk in your specific circumstances. A projection of the cash requirements of the business is most important to a lender, as it is the actual cash left after expenses that will repay the loan, not income. It also shows you are an effective manager.
A lender’s perception of risk
The following factors can influence your lender’s perception of risk. If a number of these areas apply to you and your business you may need to consider another source of finance.
Risk factors:
- start-up businesses incorporate financial, business and management risk
- lack of security
- lack of business history
- industry sector, factors will include levels of competition, barriers to entry, profitability profile and current economic conditions
- highly seasonal businesses eg. swimsuits, agriculture. You’ll need to demonstrate how you’ll deal with cash flow pressures in the off season
- lack of planning, market knowledge and finance skills
- poor credit history.
The outcome of your application is strongly influenced by how well your proposal is researched and how well it is presented.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
When it comes time to sell your business, it is important to present it to potential buyers in the best possible light. This doesn’t mean just looking good on the outside, your business should be profitable and functioning well to appeal to prospective buyers. Importantly, the business should “divorce” itself from you the owner, so that the […]
When it comes time to sell your business, it is important to present it to potential buyers in the best possible light. This doesn’t mean just looking good on the outside, your business should be profitable and functioning well to appeal to prospective buyers.
Importantly, the business should “divorce” itself from you the owner, so that the Goodwill vests in the business itself and is not seen to be part of you, the owner.
Exit Planning to Add Value
Exit planning is essential for the survival of your business, for the sole fact that not all sales are gradual processes. Some occur due to sudden events, such as ill-health or family issues. Having an exit strategy in place ensures a smoother transition when it comes time to sell your business.
A great way to prepare your business for sale is to view your business through the eyes of a prospective buyer. Would you want to buy your business if you viewed it with fresh eyes? If the answer is not a concrete ‘YES’ then you have work to do.
Here are some ways you can add value to your business when preparing to sell:
- Make sure all financials are up to date- this demonstrates that you are on top of the financial aspects of the business at all times.
- Show proof of profitability (even with certain adjustments)
- Ensure all necessary contracts are in place, up to date and can be legally transferred to new ownership
- Tidy up processes, manuals and other key operational documents to demonstrate that they are fully up to date
- Make sure your lease for the premises is secure if the premises is of critical importance to the ongoing business e.g. a retail business
- Sell off plant and equipment as well as other assets that no longer contribute to the business so that they do not represent any weaknesses and become a distraction to the sale process. Similarly with any redundant or old stock.
- Do a general ‘tidy’ of the premises.
- Organisational structure- are there key staff in place and how critical are your (the owner’s) functions to the business?
Preparing a Business for Sale can add value.
How this client prepared to sell their business so they could retire.
To demonstrate a real-life example, Roy was contacted by an accountant to meet with his client who wished to retire and sell his business.
The owner was performing the functions of both factory manager as well as a specialised machine operator on an expensive piece of equipment which produced approx. 50% of the income. I immediately identified this as a weakness and threat that a buyer would identify and I advised the Vendor to immediately advertise and employ for a qualified engineer to take over the machine operator function.
By the time that the business profile was completed and the business was placed on the market, the Vendor had employed a suitable replacement so that when qualified buyers questioned who would replace the vendor in this function, I could answer that this person was already in place and being trained. This then eliminated a major objection and opened up options of who the buyer may be. The business received 4 offers within 4 weeks and was sold within 6 weeks.
When it comes time to sell your business, it is important to present it to potential buyers in the best possible light.
Brokers Objective
The objective of an agent when selling your business is to be able to attract as many qualified Buyers as possible, in order to provide you, the Seller, with as many options as possible and to be able to obtain the best result for you in respect of both price and the terms agreed.
Life goes on. So too commerce. Most noticeable are the changes in the pace, nature, (in)consistency and modulation of both. Intensity seems to have increased across the board – for those who seek to prevail and succeed. Overall, sights have tended to be lowered, expectations reined in and relationships limited to those from whom trust, […]
Life goes on. So too commerce.
Most noticeable are the changes in the pace, nature, (in)consistency and modulation of both. Intensity seems to have increased across the board – for those who seek to prevail and succeed. Overall, sights have tended to be lowered, expectations reined in and relationships limited to those from whom trust, mutual respect, integrity, on-going accessibility and responsiveness are expected and somewhat assured.
Happiness, satisfaction and fulfilment appear to be less conspicuous. “Soldiering on” seems an apt description of prevailing sentiments. For others, the dark shadow of depression, stress and anxiety is all-consuming.
Few if any things have stopped. Progress may be tortured. Achievements generally take greater and more effort, time and resources.
Refreshingly, among those who recognise and accept the present reality philosophically, the sun still shines; it rises in the east and sets in the west. In that context, the essential benefits and labours of life are there to be enjoyed, deployed and, yes, even toyed.
Hope springs eternal. Tomorrow is another day. Application and maintaining intensity are fundamental undertakings when the essentials (of operations) are considered non-negotiable. Priorities, schedules and allocation of resources are, and should be, applied intensively.
Across the centuries, countless military leaders have embraced and implemented the philosophy:
I may lose a battle,
But I will never lose a minute.
Now is not the time to ease back. Recalibrating business models, operational standards and visions need to be introduced and sustained with enthusiasm, confidence and assertiveness.
Source:
Barry Urquhart
Managing Director
Marketing Focus
M: 041 983 5555
E: Urquhart@marketingfocus.net.au
W: www.marketingfocus.net.au
It’s normal for any business to experience some setbacks and learn how to maneuver in order to avoid the same issue again. It’s part of every entrepreneurial journey but how can you save your business if you run into an unexpected loss or breakdown? It can be quite stressful when your business encounters a major […]
It’s normal for any business to experience some setbacks and learn how to maneuver in order to avoid the same issue again. It’s part of every entrepreneurial journey but how can you save your business if you run into an unexpected loss or breakdown? It can be quite stressful when your business encounters a major problem that cannot be undone.
Hundreds of startup businesses emerge every year but only a few survive the struggles they face.
Identify the root cause of the problem
It’s important to determine the reason why your business is falling apart. Take time to go through each department and check with your employees for feedback. Getting their direct insight can oftentimes be of great help. Review what’s doing well and what’s been doing wrong.
Adversely, businesses fail because of poor leadership. As the saying goes, “A Fish Rots From the Head”, so it’s important to keep your department heads in check.
Look after your team
Employees can also sense instability whenever things get tough in the company. They will be concerned and pressured about the security of their jobs, so as a leader, it’s important to be as transparent as possible. Keep your employees engaged by showing them that they are part of the team. Develop a culture where everyone’s concerns are heard and create an environment where your employees feel safe and taken care of. Employees who feel appreciated are highly motivated to share your vision.
In addition, provide incentives to your management team to keep them on board. Being able to contribute to the company’s success is fulfillment itself but it’s more rewarding if they also benefit from it.
Assess and review your goals
Revisit your goals and be realistic on where your company is currently at. Once you have determined the reasons causing the business’s problems, create an action plan before you make the adjustments here and there.
Identify your short-term goals which include reducing overhead costs and restructuring your teams. Medium-term goals should be focused on boosting sales and generating revenues. Your Long-term goals may vary whether maybe acquiring another business or stepping up to become a leader in your field. When your goals are in place, start your strategic plan to achieve them.
Downsize where possible
Conduct a thorough employee audit and understand each role and the responsibilities then look for low revenue-generating parts of your company that you can afford to reduce. But avoid cutting your staff to minimise costs in the short term because you will need this manpower to achieve your medium and long-term goals.
Maximise your staff’s productivity and encourage them to be more efficient. Look for costs that can be eliminated like downsizing your office space and getting rid of company cars or even as simple as cutting down paper usage or going paperless. Monitoring every little expenditure can already make a difference.
Be open to change
Things that were working before may no longer be cost and time-efficient now. Learn to adapt and put your ego aside. Delegate tasks where you can so you can focus your time on other important matters to attend to and accept that some things need to evolve and getting help can be profoundly helpful. For instance, you may bring in a consultant for expert advice and fresh ideas. Sometimes a different perspective might just be what the company needs to get back on track. Be bold to interact with competitors to see if there’s a possibility of merging your business with theirs.
Childcare Management Companies Some management companies that may be able to help you and will be able to provide a quote to manage your centre depending on the level of management required. While we don’t recommend any particular management company, the following links from a Google search may be of assistance: Elite Childcare Management www.elitechildcaremanagement.com.au […]
Childcare Management Companies
Some management companies that may be able to help you and will be able to provide a quote to manage your centre depending on the level of management required.
While we don’t recommend any particular management company, the following links from a Google search may be of assistance:
Elite Childcare Management
www.elitechildcaremanagement.com.au
Early Learning Management: Child Care Management System
Leading Edge: Childcare – Management, Consultant & Training
www.leadingedgechildcare.com.au
Giggletree – Childcare Management, Childcare Consulting, Childcare
Advance Childcare Management
Brisbane Childcare Consultants | Childcare Management Group
www.limelightmanagementgroup.com.au
Our Services – Foundation Early Learning
www.foundationearlylearning.edu.au
Impressions Childcare Management
First Years Consultancy
On 1 July 2021, the value of goods covered by the definition of ‘consumer’ under the Australian Consumer Law increased from $40,000 to $100,000. This means that the consumer guarantees will apply to more transactions, including when businesses sell to other business. What is covered Businesses must guarantee products and services they sell, hire or […]
On 1 July 2021, the value of goods covered by the definition of ‘consumer’ under the Australian Consumer Law increased from $40,000 to $100,000. This means that the consumer guarantees will apply to more transactions, including when businesses sell to other business.
What is covered
Businesses must guarantee products and services they sell, hire or lease that are:
- under $100,000
- over $100,000 if they are normally bought for personal or household use
- business vehicles and trailers, provided they are used mainly to transport goods.
There are some exceptions. For example, products purchased to be resold, or to be transformed into a product that is sold, are not covered.
What are consumer guarantees?
Businesses must provide these automatic guarantees regardless of any other warranties. If a product or service fails to meet a consumer guarantee, the consumer has the right to a remedy.
A ‘major failure’ is when a reasonable consumer wouldn’t have bought the product or service if they had known about the nature and extent of the failure. In these cases, the consumer can choose to have a product repaired, replaced or refunded. For a service, they can:
- end the contract and seek a refund
- keep the contract and be compensated for any drop in value.
For other kinds of failure, the business can choose the remedy, but it must do so within a reasonable time. Possible remedies include:
- repairing the faulty good
- replacing it with an identical good
- refunding the consumer
- repairing any defect in the service provided.
Find out more about consumer guarantees and other rules businesses need to follow when treating customers fairly.
Source: Small Business Information Network
Useful Accounting Information from the ATO for End of Financial Year We found some very useful information on the ATO website to help you with your accounting at the end of the financial year. Take a look: Tips for keeping good records Good record keeping is critical to business success. To help your small business […]
Useful Accounting Information from the ATO for End of Financial Year
We found some very useful information on the ATO website to help you with your accounting at the end of the financial year. Take a look:
Tips for keeping good records
Good record keeping is critical to business success. To help your small business clients keep good records and avoid mistakes, let them know about our tips, tools and services.
Record-keeping tips
- Keep all business records including income, expenses, bank and other goods and services tax (GST) records for five years (although some records need to be kept longer).
- Records must contain enough information to calculate and support amounts claimed on activity statements and tax returns.
- Business records need to include all cash, online, EFTPOS, bank statements, credit and debit card transactions.
- Check the tax invoices received for purchases that include GST are valid.
- Keep records that show when business purchases were used for private purposes – this will help work out the business portion that can be claimed as a deduction.
- Keep business records separate from personal records to avoid confusion.
- Take pictures of paper receipts to avoid faded records.
- Store a copy of all records electronically and have a backup system in place, where possible.
- If changes were made to the record keeping software used during the year, check that all information transferred over correctly.
See also:
Issuing tax invoices – for requirements of a valid tax invoice
Record-keeping tools
- Record keeping evaluation tool – helps evaluate your client’s record-keeping practices, to see if they’re still on track.
- myDeductions – tool in the ATO app which helps your sole trader clients with simple tax affairs record and track their business income, expenses and car trips. At tax time, they can email you a spreadsheet file (CSV format) or upload their records to us to pre-fill their tax return. If they upload, the data will be available to you through the practitioner lodgment service (PLS).
Record-keeping services
- Small business webinars – helps your clients learn about good record-keeping practices and requirements.
Visit www.ato.gov.au for more information.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
Learn more about pricing regulations Setting a price for your goods and services as a business owner comes with its own set of legal responsibilities. Before you publicly display a price for your services or products, you need to make sure your business complies with certain regulations, so you don’t end up in legal hot […]
Learn more about pricing regulations
Setting a price for your goods and services as a business owner comes with its own set of legal responsibilities.
Before you publicly display a price for your services or products, you need to make sure your business complies with certain regulations, so you don’t end up in legal hot water.
Make sure you are familiar with the following terms before advertising your pricing:
Recommended Retail Price
The Recommended Retail Price — commonly referred to as RRO — serves only as a recommendation to the re-seller. It is in no way mandatory, and it is 100% illegal for a vendor to put pressure on a wholesaler to sell their products at a particular price. It’s also illegal for vendors to make any sort of threats to intimidate re-sellers to comply with their pricing demands.
Comparative pricing
Comparative pricing is exactly what it sounds like — you compare the sale price of your product or service to a former price and/or to the price of your competitors. Comparative pricing is a top strategy to put your products in a position to beat the competition, but it can be a delicate line to walk. Check out this excellent article on the ins and outs of comparative pricing for businesses.
Multiple pricing
Multiple pricing usually happens by accident. Multiple pricing occurs when a good or service has more than one advertised price. If and when this happens, the business is required under consumer law to sell the product at the lowest price or remove the product from sale until the issue has been corrected and only one price exists for the item.
Unit pricing code
Unit pricing code refers to the price per unit calculated for a product using a solid measurement like grams or litres. It allows consumers to compare the cost per unit across multiple products and can be a great way to draw customers in if your price per unit is low. Online e commerce giant Amazon offers unit pricing on many of their products. And in Australia, the unit pricing code requires that grocery stores display unit prices on certain items for sale.
Price fixing
Price fixing is illegal in Australia and in most developed countries. It occurs when two or more competitors agree on setting prices, undermining the free market with deceptive business practices. Although price fixing is illegal, it is sometimes confused with parallel pricing which is totally legal and a legitimate way of doing business.
Parallel Pricing
Parallel pricing simply involves following the pricing practices of other businesses or organizations, particularly competitors. It is a totally legal practice and can be a shrewd move to attract business. For example, if you have a similar product and notice that a competitor is outpacing you by lowering the price by 20%, you may try the same pricing scheme in an effort to get parallel results.
Different Payment Methods Pricing
Under the law, pricing a product differently depending on the payment method (e.g. credit card, cash, etc.) requires that you clearly label each price for transparency with consumers.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
How to future-proof your business We can’t predict the future as the world has found out in 2020. But in business, it’s crucial to prepare for it. No matter what the future has in store, as a business owner, you can take calculated measures to ensure your business has what it takes to weather any […]
How to future-proof your business
We can’t predict the future as the world has found out in 2020. But in business, it’s crucial to prepare for it.
No matter what the future has in store, as a business owner, you can take calculated measures to ensure your business has what it takes to weather any storm.
Want to set yourself up for success and minimize your stress?
Future-proof your business.
If you are a small business owner, it’s particularly important that you take charge of your business’ future and do everything you can to prepare for unknown outcomes. That’s why we’ve narrowed down the future-proofing process to the top three things to do to succeed as a business owner.
3 Ways to Future-Proof Your Business
1.Know your numbers.
Why do small businesses fail? One of the most common reasons is that owners don’t know their numbers.
Knowing your numbers is the key to succeeding in any business, in any industry. You need to make sure your business is profitable — or in the case of a new food business, on the path to profitability — and that you have a good grasp of your margins and expenses.
If you know your numbers intimately, you’ll be able to set measurable goals for the future that are realistic and more likely to come to fruition. Whatever you need to do to get a firm hold on where your money is going and how it’s coming in, do it fast.
2. Get the help you need.
Successful small business owners tend to be self-starters. They’re some of the most motivated individuals you’ll ever meet with intelligence and talent to spare.
But another common theme, especially among new business owners, is a pervasive do-it-yourself mentality. That is, small business owners tend to put too much responsibility on themselves. It can be a fatal flaw that will take you down quickly if you don’t learn to outsource soon.
For starters, everyone needs a good accountant that works in their best interest. A good accountant should know about your accounts as early as April, three months before the end of the financial year. As a business owner, you should be ensuring there is money put away to ensure taxes can be paid when due.
If you’re not adept at advanced analysis and predictions, work with a good bookkeeper to help you make accurate financial forecasts. It’s one thing to create spreadsheets; it’s another to analyse them properly and determine where things are going both right and wrong.
Most of us aren’t exactly comfortable with these tasks, so it makes the most sense to hire an experienced bookkeeper who can help.
3. Set goals.
Setting goals is 100% crucial to future planning for your small business.
The best approach? Break down the process that will be required to actually reach your goals.
All business owners want to earn more profits, but most do not break down how they will get there on a practical level.
Another key to future-proofing your goals is to have important reasons behind them. This is a critical step that many small businesses miss. There needs to be a deep desire present to achieve anything in life, including business. Knowing exactly why you want to improve your revenue or grow your business — and bringing your team on board with these reasons — will help you stick with your plan and reach your goals.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
Perth population up 1.8% By Mark Beyer – Business News Perth Perth was one of the fastest growing capital cities in Australia last year, with its population reaching 2.1 million, but the rest of the state lagged well behind. New data from the Australian Bureau of Statistics show Perth’s population increased by 37,600 people, or 1.8 per […]
Perth population up 1.8%
By Mark Beyer – Business News Perth
Perth was one of the fastest growing capital cities in Australia last year, with its population reaching 2.1 million, but the rest of the state lagged well behind.
Alkimos is Perth’s fastest-growing region.
New data from the Australian Bureau of Statistics show Perth’s population increased by 37,600 people, or 1.8 per cent, in the year to June 2020.
The only capital city with a higher growth rate was Brisbane, at 1.9 per cent.
In contrast to the strong growth in metropolitan Perth, the number of people in the rest of Western Australia increased by just 2,700, or 0.5 per cent.
The differential between metro and regional growth was wider in WA than for any other state.
In NSW, for instance, Sydney’s population grew by 1.1 per cent while the rest of the state grew by 0.8 per cent.
Nationally, the number of people living in the capital cities increased by 1.4 per cent while the number in regional Australia grew by 1.1 per cent.
Queensland had the fastest non-metro growth, up 1.4 per cent.
South Australia was the only state where regional growth (0.4 per cent) was weaker than for WA.
To put that in context, Adelaide expanded by a modest 1.2 per cent.
The ABS data showed that the areas in Perth with the fastest population growth were widely dispersed.
Alkimos – Eglinton in Perth’s north-west grew by 10 per cent, Hazelmere – Guildford expanded by 7.4 per cent and North Coogee was up 7.1 per cent.
The areas with the largest growth by number were Ellenbrook (up by 2,400 people), Perth City (up 2,200) and Baldivis (up 1,900).
Ellenbrook had the largest natural increase (690 people) and the largest net internal migration gain (1,300 people).
Perth City had the largest net overseas migration gain (1,400 people).
Today’s data on regional growth comes two weeks after the ABS released its quarterly population estimates by state.
That data showed WA’s population grew by 1.24 per cent for the year to September 2020.
The only state with higher growth was Queensland, up 1.33 per cent.
The quarterly data showed that Australia’s population decreased by 4,200 people or 0.02 per cent to 25,693,059 as at September 30 – the first quarterly drop in population in over a century.
This reflected falling population numbers in NSW and Victoria.
Like other states, WA bucked the national trend, with growth of 0.13 per cent in the quarter to 2,667,130.
The Value in your business The value of a business is more than its cash flow. Although many Australian business owners and management teams have been left pondering their future after a turbulent 12 months, it is important for those moving towards a sale to focus on identifying the strength of their underlying or intangible assets and […]
The Value in your business
The value of a business is more than its cash flow. Although many Australian business owners and management teams have been left pondering their future after a turbulent 12 months, it is important for those moving towards a sale to focus on identifying the strength of their underlying or intangible assets and the potential of these assets to drive future value.
Today, intangible assets such as Brand, data, content, software, customer and supplier relationships, regulatory approvals, and confidential information, account for over 90 percent of all company value. These assets are the key drivers of growth and profitability for virtually every business and in particular in areas such as Childcare.
Your Brand in the marketplace is now one of the most critical drivers of a business. Recognition of name/logo, your unique services, community participation at a local level and a social media level.
Understand where the value lies
Some valuers and brokers may claim that you can’t assign value to a company’s data, patents, confidential information, software code, regulatory approvals, relationships, or brand, but this simply isn’t true.
Today, intangible assets are likely to be the most valuable assets a company owns – but it is likely that the majority of these assets will be lying off the balance sheet. When you look at the world’s three most valuable companies (Saudi Aramco, Microsoft, and Apple) they are examples of how this is a fact, with trillions of dollars of value being driven by their intangible assets and almost all of it lying off their balance sheets.
Would you like a business appraisal?
And, if you look at businesses that are thriving, it is primarily those that have greater concentrations of high-value intangible assets. These companies are leveraging their assets to achieve faster growth and stronger earnings and are also demonstrating more resilience to market volatility than those companies that have a greater focus on fixed assets.
To be in this camp, it is important that you start to identify and define those assets that are driving value in your business. By developing a plan to protect and leverage these assets and identifying who these assets are likely to be of most value to.
If you would like a free confidential business appraisal contact Angela at Advance Business Brokers.
There is a wide range of franchise opportunities and there are too many sectors to research them all thoroughly. But you can speed up the process by assessing your skills and your resources. What are your priorities and how deep can your financial resources go? Once you have your criteria it will be easier to […]
There is a wide range of franchise opportunities and there are too many sectors to research them all thoroughly. But you can speed up the process by assessing your skills and your resources. What are your priorities and how deep can your financial resources go?
Once you have your criteria it will be easier to shortlist your franchise prospects and you’ll be saving time and energy.
Questions to ask yourself
To help you narrow down your search, here are some questions to ask yourself:
- Why do you want to get a franchise? Whether it’s making more money or having a passion for your field, it’s important to identify your goal.
- Is there a specific industry that you have in mind or are you flexible?
- What are your skills and what do you enjoy doing? A retail franchise will likely suit you better than an internet franchise if you’re a people person. You’ll be more motivated to run a business that you are interested in as well.
- Would you prefer a fast-food franchise to reduce your risk?
- Do you want to operate it personally to lessen cost or will you be hiring staff?
- Are you on a budget? How much cash are you willing and able to invest? Do you have backup funds? Internet-based, home-based, and van-based businesses usually have lower costs compared to retail or food service franchises because it requires supply and equipment, other facilities, and staff.
- How much time can you commit, and will you be willing to work on evenings and weekends? You should weigh your options especially if for example you have young children.
Once you have made your self-assessment, you’ll be more confident to decide which industry or franchise you would pursue getting. You can browse available businesses here: https://advancebusinessbrokers.com/businesses-for-sale/
Questions for the franchisor
- What is the estimated time frame for you to make a profit?
- How much working capital is needed in the meantime?
- How much income are the existing franchisees generally earning?
- Can you contact some of the existing franchisee to ask for feedback directly? Be cautious of those who insist on contacting just a few handpicked franchisees.
- Do they provide training and support? If so, what are the details?
- To what extent are they willing to provide support in finding your premise and fit out if necessary?
- Are there other fees you need to pay?
- What are their development or growth plans?
- Are they compliant with the Franchise Code of Conduct? The code sets out your rights and obligations as a franchisee and this is regulated by the Australian Competition and Consumer Commissions (ACCC).
Due diligence
However, it’s important to do your own independent research. Don’t just rely on the information given to you by the franchisor.
Do a background check on the company. Research how its assets have receded and flowed over the years. Are they still on a good track?
Search the brand name online and check for any media attention about the company. Take note of the positive coverage like sustained growth in profits, new product line, or positive community work. Negative articles might include corporate scandal or poor trading.
You may also go through the customer reviews on their website or social media pages to evaluate public opinion of the brand.
Effectively choosing a franchise that works for you means knowing precisely what you want out of your endeavour, your financial capacity, and the possible risks and rewards.
There are a lot of questions to ask the franchisor and do not move forward until you’re satisfied with the answers given. Don’t rush because it’s your time and money at stake!
Why an Enduring Power of Guardianship is relevant to you Many people fail to consider the need for an Enduring Power of Guardianship (also referred to as an “EPG”). It is important to consider the possibility of losing mental capacity at some stage in your life due to unforeseeable illness or accident. By appointing an […]
Why an Enduring Power of Guardianship is relevant to you
Many people fail to consider the need for an Enduring Power of Guardianship (also referred to as an “EPG”). It is important to consider the possibility of losing mental capacity at some stage in your life due to unforeseeable illness or accident. By appointing an Enduring Guardian, you can have peace of mind knowing that a person you trust is making suitable personal, lifestyle, and healthcare decisions on your behalf.
Many people do not have their wishes upheld when they are incapacitated. The lawyers at Frichot Lawyers can help you avoid this.
What is an EPG?
An Enduring Power of Guardianship is a legal document which allows you to appoint someone who you know and trust to make personal, lifestyle and medical treatment decisions in the event you are unable to make or communicate those decisions yourself. Through an EPG, you can decide which decisions your Enduring Guardian will be able to make, such as where you live or the type of medical treatment you will receive. The EPG will only come into effect when you lose the mental capacity to make decisions for yourself.
A case example that explains why you need an Enduring Power of Guardianship
Mike is a 52-year-old man. He was fit, healthy and had no known medical conditions. Mike began presenting with fever-like symptoms and headaches. Within days, Mike had been diagnosed with a rare infection of the brain and was induced into a coma in intensive care. The hospital concluded that it was unlikely Mike would come out of the coma and recover. Mike and his wife Susy had spoken to each other about what they would do if one of them ended up on life support. However, they had not executed the authority they wished to provide each other in an EPG. Susy told the hospital that Mike had specifically said to her: “don’t keep me alive on life support just for the sake of it.” Susy was quick to learn that without an EPG providing for specific authority to turn off life support, a doctor will do anything they can to prolong the life or the vegetative state of the person, even if that is contrary to their wishes. As a result of not having Mike’s intentions documented in an EPG, Susy was unable to uphold her husband’s wishes.
What if you don’t have an EPG in place?
If you lose mental capacity, it is unfortunately too late to prepare an Enduring Power of Guardianship. In this instance, a family member or other interested person may apply to the State Administrative Tribunal (SAT) to appoint a Guardian, including themselves.
The SAT often asks the Public Advocate to prepare a report about whether a Guardian is required and make recommendations about who should be appointed. If they believe no other person is suitable to be a Guardian, the SAT can ask the Public Advocate to take on that role. This can be a long process and can lead to great stress for your loved ones, particularly if, for example, medical treatment decisions need to be made in a short period of time.
If you need assistance navigating through the SAT process, see one of Frichot’s experienced lawyers.
What can you do now to ensure your wishes are upheld?
You should make an Enduring Power of Guardianship as soon as possible. Sadly, any of us can lose capacity to make decisions at any time because of an unforeseeable circumstance such as illness or accident.
The experienced lawyers at Frichot lawyers can:
- Provide legal advice on your personal requirements and the benefits or risks of making an Enduring Power of Guardianship;
- Help you establish the scope of authority you would like to give to your Enduring Guardian or any authority you may wish to exclude;
- Prepare your Enduring Power of Guardianship.
An Enduring Guardian cannot make financial or property decisions. See our related article on Enduring Powers of Attorney.
Article by Jasmine Moran, Lawyer in Wills, Estate Planning and Injury Law
What is Stamp Duty? Stamp duty or transfer duty is a tax required by the state or territory governments on transfers of property such as business or real estate, and usually it’s the purchaser or transferee who is accountable. Stamp duty also varies between states and territories. In 2000, Victoria removed stamp duty for business. […]
What is Stamp Duty?
Stamp duty or transfer duty is a tax required by the state or territory governments on transfers of property such as business or real estate, and usually it’s the purchaser or transferee who is accountable.
Stamp duty also varies between states and territories. In 2000, Victoria removed stamp duty for business. New South Wales, Australian Capital Territory, Tasmania, and South Australia all pursued the same decision over the last 20 years. Just three states including Western Australia, continued to collect stamp duty on the purchase of a business.
Government’s Promise
The WA government aims and has committed to reinforce the West Australian jobs and increase investment in our state. One of the key elements should then be promoting and encouraging people to purchase a feasible small business. More businesses mean more jobs!
However, stamp duty on business sales in Western Australia makes it financially more difficult for anyone looking to purchase a business in our state.
A buyer will be obliged to pay $251,415 when a business is sold at $5 million value. Imagine how useful that amount can be! That could cover extra 5 staff members or 10 additional trainees. Challenging enough with the COVID-19 situation, we don’t need this added burden on business Buyers willing to invest in our state.
According to the Australian Bureau of Statistics, businesses operating in WA kept on decreasing in the last five years. Elimination of stamp duty on business sales, will assist business owners in being able to sell their business when the time comes to exit. Being able to sell the business, maintains operations, keeps jobs, and sustains economic productivity.
Our Advocacy
Angela Williams – Chairperson of the REIWA Business Agents Committee, we at REIWA would like to urge the McGowan Government to eliminate the stamp duty for business. We want to help attract more investors and make WA more competitive to our eastern counterparts.
Childcare centres are now Australia’s fastest growing commercial real estate investment. It is one of the highest returns for any business and currently selling for 3.0 – 5x net profit. It is one of the few non-franchise businesses that banks will lend on Centres can receive up to 80% of their fees from Government subsidies. […]
Childcare centres are now Australia’s fastest growing commercial real estate investment.
- It is one of the highest returns for any business and currently selling for 3.0 – 5x net profit.
- It is one of the few non-franchise businesses that banks will lend on
- Centres can receive up to 80% of their fees from Government subsidies.
Get started and talk to Angela now!
📞 +61 416 109 017
📲 angela@advancebusinessbrokers.com
The holiday season is fast approaching and this provides a valuable opportunity for small business owners to set your company up to speed for the year. With the new world we are facing, here are our tips that could take your business to the next level in the new year! Be Open to Change As […]
The holiday season is fast approaching and this provides a valuable opportunity for small business owners to set your company up to speed for the year. With the new world we are facing, here are our tips that could take your business to the next level in the new year!
Be Open to Change
As the saying goes, it’s not the strongest nor the smartest survives, but the one who adapts best to the ever changing environment. The pandemic hit the world really hard, especially the economy. In order to thrive, your business must first survive. Adapt to the new norm and take advantage of online and other resources. Whether it’s your website host, payment gateway, or shipment partner, it’s an excellent time to explore other options and shop around to find the most competitive pricing from suppliers.
Assess Your Business and Reflect
Most small businesses don’t have a large-scale market yet so you might want to attract more people by improving your website, social media pages, and your brand as a whole. With the current physical restrictions being implemented, it’s best to increase your market appeal online. You can invest in other marketing campaigns to grow your customer base.
Make a business review for the year to check what went well and what didn’t, what strategies worked and which decisions were not good choices. Identify and effectively use this information to boost your company’s growth all year round.
Plan and Budget for the Whole Year
This would vary depending on your business. If you are expanding, hiring more staff to cater more customers is a good idea however it’s vital to set proper expectations to your workforce that some may not have as many hours during the holiday season. It is essential to keep your roster organised to keep your staff satisfied.
Talk to your accountant and sort out your business finances for the whole year. This is important so you can evaluate and determine the areas where you overspent and determine the items that can be cut down.
From Advance Business Brokers – Best wishes for a very Prosperous 2021
Cyber security is as important as physical security. With the Notifiable Data Breach Scheme, all Small to Medium Businesses need to declare any cyber breaches by law. So it is imperative to keep your systems secure. However, it can be a big problem without an IT Team dedicated to ensure your technology is up to […]
Cyber security is as important as physical security.
With the Notifiable Data Breach Scheme, all Small to Medium Businesses need to declare any cyber breaches by law. So it is imperative to keep your systems secure. However, it can be a big problem without an IT Team dedicated to ensure your technology is up to date.
Take note of these top three cyber threats and what you can do to safeguard your business against them.
1. Malware
Malware or Malicious Software includes viruses or spyware, intentionally designed to cause damage to your computer system. With today’s technology, there are a lot of experienced hackers creating a variety of attacks. Finding the right tools to block these threats is the answer.
Malware takes up a lot of storage on your computer or machine and affects the programs and daily operations, resulting in your system to run slower-than-usual.
One of the most effective and simplest ways to protect your business against Malware is Patch Software. This is a form of software that updates, improves, and pushes out any potential bugs that could go into your system. Normally, your system will notify you when there are updates available. Accepting these software updates can help strengthen your system’s resistance towards cyber threats.
Using an antivirus software also helps to remove Malware and lowering the risk of your computer to crash following on the attack.
2. Ransomware
Ransomware is also a Malicious Software that locks your screen so you won’t be able to access your system and unable to operate. The cyber criminal will then send you a message asking for a ransom or payment in exchange for your data and get your access back.
Usually the ransomware comes as emails intended to persuade the victim into providing confidential information. The fraudulent email can also include a link that gives the cyber criminal access to the victim’s computer system once it’s clicked.
You can use an Email Scanning Software to help assess the legitimacy of the email. Your email hosting provider will know the right software to use but if you’re in doubt, you may speak to a vendor like Cisco and ask for the best defense solution suited for your business.
3. DDoS
Distributed-denial-of-service or DDoS aims to make your system crash by striking numerous and simultaneous data requests. These attacks are usually done during business periods where warning signs are typical during busy hours of the business. This will put your machine under pressure due to too much traffic resulting in system failure. If your operations are affected, then your income will also be affected.
A great defense for this type of attack is using Cloud Security. It is more effective on your business because it secures cloud computing environments against both external and insider cybersecurity threats. It helps block cyber attacks and identifies risks. Therefore, you will be notified whenever there is a high volume of traffic or suspicious activity and it will be stopped before it can cause damage to your system.
In today’s cyber community, the number of attacks are increasing every year. Australian business owners should continue to improve their system security and stay vigilant to minimise the impact of possible attacks.
Strong growth in WA Resources sales Latest update from the Department of Mines Industry Regulation and Safety shows that the sales of resources in Western Australia has significantly increased. This paved the rise in jobs as well! Gold sales hit a record of $15.8 billion in the year to June 30th and a resounding $103 […]
Strong growth in WA Resources sales
Latest update from the Department of Mines Industry Regulation and Safety shows that the sales of resources in Western Australia has significantly increased. This paved the rise in jobs as well!
Gold sales hit a record of $15.8 billion in the year to June 30th and a resounding $103 billion of iron ore sales. These contributed to the $172 billion resources industry.
Despite lower prices across the first half of the financial year, Oil sales also increased 30 per cent to $2.6 billion on higher volumes while LNG has kept dominating the petroleum market with $27 billion worth of sales even though it’s down from $29 billion in FY19.
Also, a huge recovery of the Nickel sales with $3.1 billion (that’s a four-year high!).
Simultaneously, the state’s gold industry accounted for $1.2 billion. It is about 70 per cent of $1.7 billion total expenditure on mineral exploration in FY20. Spent $420 million on copper exploration, $361 million on iron ore and $203 million on nickel and cobalt.
The state’s resources sector invested almost $19 billion in FY19, higher than the $17 billion investment in FY18.
The iron ore sector provided the most royalties to Western Australia, up from about $4.9 billion to $7.8 billion. Followed by gold with $361 million royalties, previously $291 million.
Job Surge
The DMIRS also recorded an average of 135,000 people employed in the state’s resources sector. A good increase from the previous 128,374 employed. The iron ore sector also recorded the most employees, giving 48,000 people jobs. Succeeded by gold with about 26,000.
Mines and Petroleum Minister Bill Johnston said,
“Creating jobs is the McGowan Government’s number one priority, so it’s encouraging to see employment continuing to grow in the resources sector.”
“These record results underpin the importance and resilience of the resources sector as WA recovers from the impacts of the COVID-19 pandemic.
“It is particularly pleasing to see strong growth in exploration expenditure, which has been achieved despite the difficulties caused by the global pandemic.
“Maintaining our support of the state’s mining and petroleum industries is a key part of the McGowan Government’s Recovery Plan to keep WA in a strong economic position.”
According to the state, it has more than $100 billion worth of projects being developed.
Western Australia mineral exploration activity records a five-year high! July and August figures showed a 63 per cent increase on the 195 monthly average for applications and processing in the last five years. The report also shows 70 per cent of applications received in July and August were gold exploration. In August, the Department of […]
Western Australia mineral exploration activity records a five-year high!
July and August figures showed a 63 per cent increase on the 195 monthly average for applications and processing in the last five years. The report also shows 70 per cent of applications received in July and August were gold exploration.
In August, the Department of Mines, Industry Regulation and Safety received 317 Programme of Work applications and approved 99 per cent of all the applications it received that month.
Mines and Petroleum Minister Bill Johnston said,
“These encouraging figures indicate that Western Australia’s exploration sector is thriving.”
“The timeframe reduction will have a direct benefit to the mining industry and we can see it is already promoting economic activity in the regions.”
The Association of Mining and Exploration Companies with its chief executive officer Warren Pearce said that the increase in the results were encouraging and showed notable strength in the exploration industry.
According to Mr. Pearce,
“Twenty-eight companies were able to raise funds of $10 million or more, up from 12 companies in the March 2020 quarter, with gold companies ahead.”
“The ability of the state government to prevent the spread of COVID-19 in WA has provided certainty around land access”
“This has meant that companies were able to focus their efforts on projects in the state.”
Updated data from the Australian Bureau of Statistics showed that Western Australia’s total exploration expenses increased by $45.3 million over the June quarter, to record $412.4 million.
Childcare centre can be a very lucrative business but it shouldn’t be the only reason you are buying one. They are a highly rewarding and profitable business but they require dedication and strong leadership. You will be responsible not only for the physical and emotional welfare of the children attending your centre but also the […]
Childcare centre can be a very lucrative business but it shouldn’t be the only reason you are buying one. They are a highly rewarding and profitable business but they require dedication and strong leadership.
You will be responsible not only for the physical and emotional welfare of the children attending your centre but also the business as a whole. The job may be filled with fun, games and play but it’s important to keep it professional. The standards are high in this sector.
You need to set an example to your staff. You will need to be punctual, enthusiastic, polite, and rigorous about following the directives set by the Australian Children’s Education and Care Quality Authority. It’s also important to observe discretion and forethoughtness when dealing with parents. Keep a detailed and systematic records of the children’s developments and special requirements.
Do you have respect for authority?
Buying a childcare centre comes with a great deal of responsibility because the business is nationally regulated. ACECQA regulates and inspects daycares or childcare centres.
Visit https://www.acecqa.gov.au/resources/opening-a-new-service and learn what you need to know to open an educaation and care service in Australia.
ACECQA will be looking at the proficiency of the staff/child ratio, health and safety, space, resources, suitable activities for emotional, physical and social development, special needs, child protection procedures, and record keeping.
Maintaining a positive relationship with your ACECQA inspectors and developing transparency in your dealings with them, will ensure a highly recommended reputation of your business.
Are you sensitive?
Most parents are apprehensive about leaving their children at a DayCare for the first time (usually they are more anxious than their kids after drop-off). It is important that you are amicable and understanding about any worries or special requests.
You will have to listen carefully to how Anna is sensitive to loud noises, that Chris won’t eat cucumbers, and Lenny has to have his Mr. Fluffy all the time.
You also have to remain sensitive at all times to any unusual behaviour. Dyslexia and Attention Deficit Disorder (ADD) are rarely diagnosed before the age of seven and such behaviours may be an early indicator.
Observe and get to know their characters and quirks for you to be able to approach each child accordingly and this will help you run your childcare centre smoothly. This would also reassure parents that their children are safe and in the right place.
Do you know your local area?
Do your research and make sure there aren’t too many other thriving childcare centres in the area. Many may have opened after the centre you are buying was established and the level of competition might be the reason for the sale of the business.
Check also the local demographics. It is vital that a lot of young families are living within a five mile radius – that is where the 80% of clients of the childcare centre come from. It would also be advantageous to be placed near a good transport links so parents can drop and pick-up their kids on their daily commute.
Are you creative?
There are numerous ways to incorporate learning and development to creative play and activities. Encourage your staff to come up with educational yet fun projects to encourage children to participate. Then decorate the room with the children’s masterpieces. Parents and children likewise respond well to a bright, colourful environment. Just change the activities as well as some materials periodically so children won’t get bored of it.
Do you have strong principles?
The Australian Government Department of Education, Employment and Workplace produced the Educators’ Guide To The Early Years Learning Framework For Australia.
“The aim of the EYLF is to extend and enrich children’s learning from birth to five years and through the transition to school. It assists educators to provide young children with opportunities to maximise their learning potential and to establish the fundamental basis for future success in learning.”
Elements of the EYLF
The EYLF sets children’s learning at the heart and comprises three interconnected elements: principles, practice and learning outcomes. All three elements are essential to early childhood education and program decision-making.
Principles
- Secure, respectful and reciprocal relationships
- Partnerships
- High expectations and equity
- Respect for diversity
- Ongoing learning and reflective practice
Practice
- Holistic approaches
- Responsiveness to children
- Learning through play
- Intentional teaching
- Learning environments
- Cultural competence
- Continuity of learning and transitions
- Assessment for learning
Learning outcomes on children
- have a strong sense of identity
- connected with and contribute to their world
- have a strong sense of well being
- confident and involved learners
- effective communicators
Physical, cognitive, linguistic, social and emotional development are all given equal terms in this directive. As a childcare centre owner, it is important that you have a solid understanding of how you intend to deliver these core elements of learning.
Can you ‘be present’?
Ensure leadership to your families and staff by being available to them. Build relationships with local businesses whose employees may need your services.
Nurture positive relationships with your community by having open days and organise events, shows, or trips to local museums and parks. You will realise that adding a personal flair will be the key to your childcare centre’s success.
Did you know that one of the reasons that a business for sale takes so long to get sold is because it’s priced too high? Any owner would always want the business sold at the right price or even higher. Not to mention the need to give an allowance in cases that buyers would haggle, […]
Did you know that one of the reasons that a business for sale takes so long to get sold is because it’s priced too high?
Any owner would always want the business sold at the right price or even higher. Not to mention the need to give an allowance in cases that buyers would haggle, sellers tend to price their business really high. This is a common mistake in selling a business. Sellers need to keep in mind that people who are looking to buy your business have looked at other businesses for sale for several months. Keen buyers compare what’s good and what needs improvement to make sure they are weighing their options properly.
Though it’s best to give room for negotiation, one third of the price based on the market value is a remarkable difference.
If we are selling a business worth $650k and we price it at $850k to test it out in the market. The business sits on the market for months with minimal or no interest. They would think that you are not serious about selling the business and that’s why it’s overpriced.
You will lose the buyer’s interest and it’s going to sit there in the market for a long time and you will be forced to lower the price based on the actual market value. By then you have already wasted your time and money or a potential buyer. That’s how vital to effectively price the business right off the bat.
How would you know that your asking price is right?
Here are a few steps to help you:
- Work with a bookkeeper or accountant to get your financial statements in order and to show the business to its financial advantage
- Consider the value of the tangible assets to have a better evaluation of the business worth
- Prepare your owner’s cash flow or statement of seller’s discretionary earnings so that you can see the full earning capacity of your business
- When you have done your estimate, check also other recent listings of similar businesses for sale and compare their asking prices.
Then deliberate with your sales advisor and/or broker the pricing information you’ve gathered and see how your pricing estimate coincides with the prices of recent comparable-business sales.
Set the price right and the opportunity to sell your business is just around the corner!
Your business name and trade name can be different. Your business name is the legal name you enter on government forms and applications. It is your full name followed by a word or words that describe the type of business you are running. If your name is Eric Hamilton and you own an insurance agency, […]
Your business name and trade name can be different. Your business name is the legal name you enter on government forms and applications. It is your full name followed by a word or words that describe the type of business you are running. If your name is Eric Hamilton and you own an insurance agency, your legal name can be Eric Hamilton Insurance.
If you will be trading under your own name, Eric Hamilton or your legal business name, you don’t need to register however, if you want to trade under a particular name, you need to have it registered as a business name.
You would also then need to apply for an Australian Business Number (ABN). When you register a business name with Australian Securities and Investments Commission (ASIC), it will be shown as a “registered business name” against the associated ABN on ABN Lookup. The ABN Lookup contains a list of all Australian Business Numbers (ABNs).
For more information on how to register a business name, visit https://asic.gov.au/for-business/registering-a-business-name/
Appetite for childcare centre properties is increasing in WA, but some players warn sector maturity won’t come without growing pains. Investors are snapping up childcare centres in Western Australia, drawn by the yield and security offered by national operators holding long-term leases, according to Ray White senior commercial property adviser Michael Milne. WA childcare property sales surged over […]
Appetite for childcare centre properties is increasing in WA, but some players warn sector maturity won’t come without growing pains.
Burgess Rawson sold the new childcare centre in Padbury during the pandemic for $4.6 million. Photo: Burgess Rawson
Investors are snapping up childcare centres in Western Australia, drawn by the yield and security offered by national operators holding long-term leases, according to Ray White senior commercial property adviser Michael Milne.
WA childcare property sales surged over the past 12 months, according to Ray White Commercial’s latest financial year activity review, with the total value of sales transactions more than doubling in 2019-20.
“There’s nothing unattractive about long leases – more recently 20-year leases,” Mr Milne told Business News.
“Most of them have three per cent rental growth year-on-year, (and) have major national covenants and it’s a growth industry.
“There’s also been a swing towards some days in childcare, even if you’re a stay-at-home parent.”
Ray White head of research Vanessa Radar said income derived from childcare facilities was heavily government-subsidised, making it attractive to buyers as a ‘set-and-forget’ asset, backed by strong occupancy levels and, in some locations, waiting lists.
“This was never really considered an asset class, however, more investors have acknowledged it is a stable income stream,” Ms Radar said.
“Also, as new facilities are built, due to growing population over the past few years, this has allowed for more savvy buyers and funds/private syndicates to band together to purchase, making it a far more sophisticated investment option than ever considered before.”
Burgess Rawson director Adam Thomas, who specialises in the healthcare and childcare markets, said WA had experienced exponential growth.
The agency had leased nine early learning centres (792 new places), over the past 12 months.
The recent categorising of childcare as an essential service, he said, had only increased appeal, backed by strong underlying consumer demand.
Centres across the country notched up record attendance numbers in the December 2019 quarter (up 3.6 per cent on the previous year), according to government reports.
As an example, Mr Thomas pointed to the sale of a new Padbury-based childcare centre during COVID to a private Perth investor at auction for $4.6 million on a 6.48 per cent yield.
That centre is anchored by a 20-year lease and two 10-year options to Grassroots Childcare, operated under the NIDO brand by ASX-listed Think Childcare.
“The fact the federal government has bipartisan support for early education and childcare, is quite vital to investors’ confidence,” Mr Thomas told Business News.
The extent of that support was outlined in Burgess Rawson’s Childcare Industry Insights report, released earlier this month.
It highlighted that although occupancy rates fell during the pandemic, childcare centres received 50 per cent of fees based on a February-reference period, plus JobKeeper.
The report predicted overall industry growth over the next five years, increasing 2.2 per cent.
Mr Thomas said investor and service provider appetite had also been underpinned by the WA market experiencing the largest rise in government-approved childcare services in the four years to June 2018.
“The WA market has seen less stock and it was, up until a year or so ago, a less mature market compared with other states, probably as a result of below- average population growth,” he said.
“The resources sector is starting to gain traction again and incomes have risen, it’s got population growth … a lot of those key drivers are helping.”
Growing pains
Perth entrepreneur Rory Vassallo, who heads private investment company Vassallo Corporation, has been involved with the local childcare centre property sector for more than 17 years.
Mr Vassallo, a 40under40 winner, sold his Great Beginnings childcare centre business to ASX-listed G8 Education for $65 million in 2014 but has stayed in the game, developing assets.
Although Mr Vassallo remained tightlipped on the details of his property portfolio, he said he had a steady pipeline of childcare centres, with that asset always front of mind.
“Childcare centres are always first because it’s what I know; I learnt when I sold the childcare businesses that you stick to your knitting,” Mr Vassallo told Business News.
“I like that it can’t be replaced by technology – that was my first attraction when I got into it at the ripe age of 20.
“It’s a high risk – childcare is not easy, it’s hard; you can build the best childcare centre on the wrong street.”
Mr Vassallo said the sector had come a long way since the early 2000s in terms of property quality and regulation funding, but that oversupply was a potential emerging issue.
“In the eastern states, they were for a while there building them next door to each other, which was just madness,” he said.
“We’ve got some pretty sophisticated mechanisms and matrixes that we go by to choose where we put a childcare centre, unfortunately some people don’t use the same methodology.
“Too many in the same area – no one is successful.”
Increasing rental values was seen by Mr Vassallo as another double-edged sword.
“A lot of people are paying a lot more than what the proven metrics are in terms of rent to revenue ratios,” he said.
“For them to be able to pay that there’s a cut somewhere … someone’s missing out and hopefully that’s not on the quality staff or equipment.
“A lot of people are attracted to it … you read too many papers about rental yields, but do due diligence on the operator.
“A childcare business can be no business very quickly with the wrong operator or the wrong staff.
“It’s (still) pretty good, you’ve got to be careful these days – they’re popping up everywhere.”
LJ Hooker Commercial Perth director Brian Neo said while his office had not focused on childcare centres, he acknowledged there was a large appetite for investment-grade assets with secure income.
“This is reflected through low interest rate returns from the big four banks, and also as a result from typical ASX-listed companies cancelling or differing dividend payments,” Mr Neo said.
“Whilst we appreciate the appetite for childcare centres being sold, as well as petrol stations with long-term leases, buyers should also be wary of the underlying land value and improvements they are investing in.
“Although attractive in yield, the investors are typically paying full price for the land and building, leaving very little upside in capital appreciation over the duration of the lease.
“With interest rates sitting where they are, investors need to be wary of any future exit strategy to reclaim any initial capital invested.”
Business Buyers Appraisal Package Are you about to Buy a business? Have you found a particular business you are thinking of making an offer on? Purchasing a Buyers Appraisal package will provide you with expert advice on the process. A small investment today may save you thousands of dollars and grief later if you have […]
Business Buyers Appraisal Package
Are you about to Buy a business? Have you found a particular business you are thinking of making an offer on?
Purchasing a Buyers Appraisal package will provide you with expert advice on the process. A small investment today may save you thousands of dollars and grief later if you have not taken the right precautions.
An experienced broker will review the financial information and other documents you have been provided with. You will be advised what further documents you should be requesting to see, and what steps you should be taking before and after you make an offer.
The package includes the following:
- Analysis of Financial info e.g. Profit & loss statements/Add-backs
- Perusal of lease and any recommendations in regard to items that should be addressed in contract e.g. additional lease terms, inclusion of ROE etc.
- Review of Schedule of Franchise agreement if applicable
- Review of employees – numbers, conditions of contract to be considered
- Suggested conditions of contract
- A recommended offer price
- An Appraisal document with the pros and cons of the business, along with suggested offer price and the market value based on current market conditions and industry knowledge.
- A complete series of emails sent every two – three days with detailed information on the process of Buying a business in Australia.
- Full version of e-book “Don’t Lose Your Shirt”
- Tips and things to look out for when buying any business
The document is an appraisal, it is NOT a valuation. It will provide a suggested offer price based on the opinion of Angela Williams, a Business Broker with 16 years’ experience.
The price does not include the following:
- Writing of conditions of contract
- Providing Contract of sale
- Due diligence of financial accounts
The recommendations will be based solely on the information provided. It is the Buyers responsibility to consider the information in the appraisal document, to evaluate and act on, if they chose to.
The review of any legal documents will focus on whether they include or do not include normal commercial business requirements e.g. ROE. Whether fees/rent are reasonable within normal commercial terms.
Upon receipt of all documentation requested to complete appraisal, the appraisal will be provided within two business days.
To proceed – please email angela@advancebusinessbrokes.com and you will be sent an invoice for payment. 50% due prior to work commencing and balance prior to receipt of final appraisal document.
Mobile: 0416 109 017
Business Broker:
Angela Williams Principal/Licensee
Advance Real Estate & Business Brokers Pty Ltd
Lic No. 63767
Advance Business Brokers accepts no responsibility for the authenticity, accuracy or undisclosed information that is provided or not provided by the Buyer.
Advance Business Brokers (AU) does not make any representations or warranties, expressed or implied as to the accuracy or completeness of this information. Nothing in the report that will be provided should be relied upon as a promise or representation to the future. The information will be based on certain assumptions and management analysis of the information provided at the time the report was produced.
The Buyer accepts and agrees that any offer on a business put forward as a result of this appraisal is solely their own decision. Any failure to secure a business as result of the offer being declined or outbid can in no way be attributable to Advance Business Brokers.
It is at the buyer’s discretion to submit offers and negotiate same.
A Goal Is Just A Dream Without A Plan Like any other business, the goal is to be successful but what success is to others may not be for your business. So your goal as a business must be specific. Create a company’s mission and vision to help everyone go in the same direction. And […]
A Goal Is Just A Dream Without A Plan
Like any other business, the goal is to be successful but what success is to others may not be for your business. So your goal as a business must be specific. Create a company’s mission and vision to help everyone go in the same direction.
And to achieve one’s goal, one must plan!
Strategic Planning occurs in the corporate level which is focused on attaining the long-term objectives of the company. Brainstorming and forecasting possible challenges and what steps to take to overcome those roadblocks in order to fulfill the business objectives. Sets priorities and align the resources that the functional level can perform.
Operational planning on the other hand takes place in the functional level. This is more concentrated on the short-term targets of the company. These are the small steps turning to bigger wins that leads to the accomplishment of the business goals.
Venturing into business is exciting but can be stressful at the same time. You have all these questions, if you should pursue or not because of a lot of factors. So it’s important to have people you can trust or a team of professionals to guide you through the process. They will help you […]
Venturing into business is exciting but can be stressful at the same time. You have all these questions, if you should pursue or not because of a lot of factors. So it’s important to have people you can trust or a team of professionals to guide you through the process. They will help you verify and review all information relevant in buying a business. Your business acquisition team should include but not limited with the following:
A legal practitioner
The Legal Practitioner or Solicitor deals with the legalities of the transaction ─ check licenses and registrations, review regulatory issues, and draft the purchase agreement. It is vital to choose a seasoned professional who has a lot of experience in the commercial and business sales. Your solicitor will help you conduct due diligence and make sure that proper assessments are made to protect your interests.
An accountant
A proficient accountant will show you the whole picture of the financial side of the business for sale as well as the anticipated returns or financial needs. Have an accountant that specialises in business buying and auditing financial statements to help you assess the financial data and operations of the business you are potentially investing in.
A friend or family
Though it’s imperative to have the experts’ advice when acquiring a business for sale, talking to people you are comfortable and trust like to a family or a friend is likewise essential. It’s good to have people you can share your excitement and apprehensions about the new endeavor you are about to step into. The decision is, of course, still up to you but their consumer ideas might just challenge your thinking and help you evaluate your next step.
Workers’ Compensation payments are payable to an employee who suffers a psychological or physical injury whilst at work. The Workers Compensation and Injury Management Scheme is a ‘no fault’ system, meaning that there is no requirement to establish that an employer was at fault to make a claim. The legislative framework surrounding the Scheme is […]
Workers’ Compensation payments are payable to an employee who suffers a psychological or physical injury whilst at work. The Workers Compensation and Injury Management Scheme is a ‘no fault’ system, meaning that there is no requirement to establish that an employer was at fault to make a claim. The legislative framework surrounding the Scheme is to be found in the Workers’ Compensation and Injury Management Act 1981, and the government agency responsible for overseeing and regulating the Scheme is WorkCover WA.
HOW DO I SUBMIT A CLAIM?
- If you are injured at work, the first step is to notify your employer of the injury You should ensure that all injuries, no matter how small are reported to your employer and you should request a claim form 2B from your employer or download a copy from the WorkCover WA website You will then need to see your General Practitioner and request a first medical certificate.
- You will then need to see your General Practitioner and request a first medical certificate.
- Both the completed claim form 2B and the first medical certificate should then be provided to your employer to make the claim.
Tips
- Ensure that all injuries are listed on the first medical certificate. This is because injuries that are not identified on the first medical certificate could be rejected as part of the claim at a later date.
- An injured employee has the right to choose who their treating general practitioner, physiotherapist, specialists and rehabilitation providers are. You do not have to see your “employer’s doctor”. At the start of a claim, see a general practitioner who you are comfortable with, if possible, as it is likely that this practitioner will be heavily involved in your injury management and rehabilitation throughout the claim.
- Keep a copy of the completed claim form 2B and the first medical certificate together with any proof of submitting the claim, for example, emails to your employer.
Upon receiving the claim, your employer has five days to lodge the form with its insurer, and the insurer has a further 14 days to respond to the claim.The Workers’ Compensation insurer, within 14 days, must confirm if the claim is either accepted, declined, or pended (put on hold) for further investigation or medical reports to be obtained.
If the claim is declined, there is an appeals process or conciliation service available through WorkCover WA.
If you do not receive a decision on your claim within the above mentioned time frame, or if your claim is pended or declined, it is strongly recommended that you seek legal advice immediately.
WHAT COMPENSATION AM I ENTITLED TO RECEIVE?
1. Weekly Payments of Compensation (loss of wages)
Loss of wages will be paid pursuant to the scheme where you are totally or partially incapacitated for work.
Calculating your weekly payments depends upon whether you are a worker working under an industrial award or not. Most employees receive a salary similar to their usual salary (including overtime payments) for the first thirteen weeks following injury, and will then step down to a lower amount which excludes any overtime and bonuses.
Often disputes arise in relation to the calculation of weekly payments, and it is recommended in the event of such a dispute, that legal advice is sought.
There is a prescribed amount in relation to weekly payments, which is the maximum amount that an injured worker can receive in terms of weekly payments for loss of wages, during the lifespan of the claim.
Tips
- Ensure that you have your wage slips from the 13 week period prior to your injury available for inspection, to help with accurately working out your pre-injury average income in the event of a dispute.
2. Reasonable Treatment, Rehabilitation and Travel Expenses.
The scheme covers reasonable travel expenses together with reasonably required medical expenses associated with general practitioners, specialists, and rehabilitation services.
Again, there is a prescribed amount in relation to these expenses, which is the maximum amount that an injured worker can receive in terms of treatment, rehabilitation and travel expenses, during the lifespan of the claim.
Often disputes arise in relation to payment of treatment expenses, where for example, there is a disagreement as to the reasonable requirement for surgery following an injury. It is recommended in the event of such a dispute, that legal advice is sought.
Tips
- Seek out treatment providers of your own choice.
- A rehabilitation provider may be appointed by your employer or insurer to assist with your return to work program. Your return to work may be a complicated process, requiring specialist input and a period of readjustment, or even retraining. It is strongly recommended that you exercise your right to appoint a rehabilitation provider of your own choice to support you through the process.
3. Permanent Impairment Lump Sum
In some cases, following an injury at work, you may be left with a permanent impairment or incapacity which you are entitled to receive a lump sum payment for.
In this instance, you will need to attend a permanent impairment assessment with an approved medical specialist.
Assessment of lump sum awards is complicated, and where you have residual impairment following an injury at work, no matter how small, it is recommended that you seek independent legal advice.
WHEN SHOULD I RETURN TO WORK?
Your treatment providers, medical specialists and rehabilitation provider will work with you to facilitate your return to work following injury.
At all visits to your general practitioner or specialists, you should be provided with an updated progress medical certificate. This certificate will indicate your fitness for work, whether you are totally unfit, partially or fully fit for duties. Often, you may be certified as fit for work with modified duties.
Each certificate will be provided to your employer, and if suitable duties are available you are obliged to attend work and undertake those duties. Your rehabilitation provider will assist with your return to work program, and making sure that your duties correspond with the restrictions identified on your medical certificates.
Often disputes arise when an employee or employer are not satisfied with a return to work program. It is recommended in the event of such a dispute, that legal advice is sought.
Tips
- Ensure that you are fully compliant with your treatment program and attend all appointments.
- Ensure that your medical certificates are always up to date and that you are clear in relation to what duties you are/ are not certified as fit to undertake.
- Choose your own rehabilitation provider.
DISPUTES
In the event of any dispute, WorkCover WA as the regulator of the Scheme, offer a dispute resolution and conciliation process.
WHEN IS A WORKERS’ COMPENSATION CLAIM SETTLED?
A claim cannot be finalised until you have reached maximum medical improvement. That does not mean that you have to be fully recovered, and often employees can be left with a permanent impairment following an injury at work.
What this means is that you have made as good a recovery as you are going to make and there is no prospect of further improvements over time or with further treatment.
In order to settle your claim, you will need to undertake a medical examination to determine any permanent impairment, by an approved medical specialist. Strict guidelines are in place for assessing permanent impairment.
A determination of the value of your claim will involve an assessment of your personal circumstances and includes your capacity for work at the time of settlement, your ongoing need for medical treatment and any permanent impairment.
If you are approaching settlement of your claim, or have received an offer of settlement, it is strongly recommended that you seek independent legal advice.
Tips
- Do not settle your claim if you have ongoing medical issues arising from your workplace injury, you will be responsible for any future medical expenses once your claim is settled.
- Seek independent legal advice before settling a Workers Compensation claim.
COULD I PURSUE A COMMON LAW CLAIM?
Where the workplace injury has arisen as a result of an incident which was the fault, or partial fault of the employer, and the injury sustained is severe enough to attract a whole person impairment of at least 15%, you may be able to pursue a common law claim against your employer outside of the statutory workers’ compensation scheme.
You must elect to pursue a common law claim within 12 months of lodging a workers’ compensation claim. This is known as your ‘termination’ day, and the workers’ compensation insurer must notify you in writing of your termination date 6 months after you have made the claim.
If you do not elect to make a common law claim by the termination date, you will forfeit the right to make a common law claim.
Once you elect to make a common law damages claim, your entitlement to payments pursuant to the Scheme is affected.
Tips
- Do not settle your claim if you have ongoing medical issues arising from your workplace injury, you will be responsible for any future medical expenses once your claim is settled.
CONCLUSION
Workers’ Compensation claims often require specialist knowledge and expertise. Frichot Lawyers offer a free confidential, no obligation appointment to injured workers.
By Dawn Williams, Senior Associate, Frichot Lawyers.
* For a free, no obligation consultation with Dawn, to discuss your claim please call Frichot Lawyers on 08 9335 9877.
Why buy a childcare business? Childcare centres are now Australia’s fastest growing commercial real estate investment. Unprecedented growth in the sector is outpacing all other real estate, creating what The West Australian calls a ‘golden child’ of property investment. The single income household is becoming a rarity, as most couples head to the workplace. These […]
Why buy a childcare business?
Childcare centres are now Australia’s fastest growing commercial real estate investment.
Unprecedented growth in the sector is outpacing all other real estate, creating what The West Australian calls a ‘golden child’ of property investment.
The single income household is becoming a rarity, as most couples head to the workplace. These families are creating a gigantic need for childcare centres in nearly every geographic area of the country.
Why?
At the end of the day, the financial benefit of a dual-income household outweighs the burden of daycare costs.
It doesn’t hurt that the bulk of government spending on childcare — $8.8 billion in 2018 to 2019 — was issued directly to childcare operators. Ipso facto, childcare businesses can always pay the rent.
Why childcare is a lucrative investment
The market for quality childcare is undeniable, and government support eases the burden on childcare operators.
Forward-thinking entrepreneurs across Australia are cashing in.
Buying a childcare business today in Australia is a highly lucrative investment for the following reasons:
- Categorically easier to get financing (versus other businesses).
- Childcare centres are considered high-yield, low-risk investments, with a rapidly increasing buyer base.
- Good lease conditions and a low interest rate environment have made the childcare industry Australia’s most attractive new investment class.
- Purchase demand is high among local,national and even international investors.
- Urgency- The growing need for long-term childcare gives an urgency to the market that has helped to push growth to new levels.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
3 Reasons to Buy a Business in Australia (or Anywhere) Have you been thinking about buying a business? Do you regularly have daydreams about owning your own business and making your mark on the world? Owning a business requires hard work, time, money, and endless energy. But the potential rewards can provide you the freedom […]
3 Reasons to Buy a Business in Australia (or Anywhere)
Have you been thinking about buying a business?
Do you regularly have daydreams about owning your own business and making your mark on the world?
Owning a business requires hard work, time, money, and endless energy. But the potential rewards can provide you the freedom to make those daydreams a reality.
There are many reasons why people choose to purchase a business, but we thought it’d be fun to discuss those at the top of the list. Check out our 3 most common reasons to buy a business in Australia (or anywhere for that matter!).
1.Freedom
One of the top reasons people are attracted to buying a business is the freedom that it affords. Modern life has turned most of us into hectic bees, buzzing constantly between work, family, and social obligations. If someone told you you could instantly have more freedom and flexibility in your life, you wouldn’t hesitate to accept.
Buying a business certainly won’t give you instantaneous freedom, but it can open up the flexibility to:
- Set your own hours.
- Work where you want.
- Work with who you want
- Take leave when want
- Attend school events without asking
This kind of liberty at the workplace is what most people only dream of. But it doesn’t have to remain a dream — buying a business is a great gateway to achieving the freedom and flexibility you crave.
Depending on the business you buy, as a business owner, you will likely be able to work when you want. That’s not to say you will work less, but it will be on your terms. If you don’t want to be as involved in the day-to-day operations of a business, try to find a business for sale that already has a strong management team.
2.Be the Boss
Even the best boss is still just that — your boss.
While working under another person, it may not matter how much you think you could improve things at work. Your hard work and loyalty can only go so far, as long as the business is not yours.
People who seek to improve things, perfectionists, and clever individuals passionate about their business will often look to other avenues when hindered by a boss. They may try for another position at the company, switch companies, or better yet, look into buying their own business.
As a small business owner, the go-getter gets to be in charge of how things are run. They can manage any and all the processes they want, from day-to-day operations to HR, marketing, and more.
If you’re thinking about becoming a small business owner, make sure you have good people skills and that you have the savvy required to succeed in your industry.
3.Buying a business is WAY easier than starting one
We’ve touched on this one before, and the truth remains the same —
BUYING A BUSINESS IS EASIER THAN STARTING ONE!
The list of reasons why goes on and on. If you purchase an established business, you’ll already have a built-in customer base. You’ll have a location that you don’t have to find and employees you won’t have to search for. You’ll have the third-party vendors you need to keep the business running already in place. In short, you’ll be saving yourself a gigantic amount of time, money, and stress!
Plus, financially speaking, buying a business is a less risky endeavor.
You’ll generally see faster returns than if you start your own business. If you need capital, banks are much more willing to grant financing to businesses with a proven track record. Same goes for potential investors.
Are you ready to buy a business?
Be sure you have done your research and are prepared to succeed in your industry. It’s also important to understand that while being a business owner allows you a certain amount of freedom, it will involve a lot of hard work, determination, and dedication.
But if you’re up to the task, it can be one of the best decisions you will ever make.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
How to Get Financing to Buy a Café Two financing options to buy a café If it’s your dream to own your own café, purchasing an existing business is a great way to minimize risk and make sure your company is on solid ground. Buying and running your own business will require hard work, dedication, […]
How to Get Financing to Buy a Café
Two financing options to buy a café
If it’s your dream to own your own café, purchasing an existing business is a great way to minimize risk and make sure your company is on solid ground.
Buying and running your own business will require hard work, dedication, and of course, financing.
For prospective business buyers new to the game, getting finance to buy a café can seem like the most daunting and scary aspect of all. But if you know your options, you’ll be ahead of the game.
The most common finance options when buying a café — or any business, for that matter — are through debt or vendor finance. Debt financing simply means you’ll get a loan from a third party.
Vendor financing is another option for buying a café. We walk you through all three, so you can get a good feel of what’s right for you.
Getting the financing to buy a café is not as scary as it seems. Take a look at our top ways to finance a café purchase. We’ll highlight the three options with the pros and cons of each. Get one step closer to owning a café and securing the financing you need.
Option 1: Debt finance for purchasing a cafe
Debt Financing
Debt financing refers to any money you borrow from a third-party lender, usually a bank, credit union, or other financial company. To purchase a business like a café, you’ll be borrowing a fixed amount. Your interest rate will hinge on several aspects such as your credit, how much you are borrowing, etc.
However, you can also use debt finance to fund the purchase of your new café by getting the loan from a friend or family member. Like we discussed with making friends/family equity partners, seriously take into account if the relationship can withstand the pressures.
If you think debt finance might be a good move for you, be sure to:
- Check your credit and improve it if needed.
- Thoroughly research all prospective loans and lenders, including the interest rate and time frame.
- Set realistic expectations about whether or not you can pay the money back according to your business plan and projected profits.
- Approach lenders with your bases covered. The more information you have, the better. This includes your business plan, personal income history, budget forecasts, financial records of the existing business, etc.
- Talk to an accountant to make sure you can afford the loan you need without putting yourself in financial jeopardy.
- Document the agreement in detail if borrowing from a friend or family member.
Debt Finance Pros
- No forfeited equity– You don’t have to give up any ownership in your company. You can retain as much control as you want and will not have to share profits.
- No relationship strain– If you go with a lending institution, you won’t have to worry about putting stress on a close relationship with a loved one.
- Interest is tax deductible– The interest owed on your small business loan for your café is tax deductible.
Debt Finance Cons
- The loan must be repaid– Unlike equity finance, your borrower will come for this money and have every legal entitlement to do so.
- Interest– Even though your interest will be tax deductible, you’ll still end up paying more than what you initially borrowed.
- Tougher requirements– Unlike an investor, lending institutions will make you jump through more hoops to get your hands on their financing. You will have to make a deposit and even put up assets such as your home as collateral.
- Bigger risk– In the event you cannot repay your loan in the set amount of time, the bank can seize your assets lawfully.
Option 2: Vendor finance for purchasing a café
Vendor finance
Vendor financing is often referred to as owner financing or seller financing. The person or people who sell you the café also loans monies to help you get started as part of the purchase price. Vendor finance usually occurs when the buyer cannot quite afford the purchase price, and the seller is intent on selling to said buyer. The seller will basically accept an IOU from you to be paid back in an agreed-upon timeframe.
To secure vendor financing for a cafe, here’s a list of what to expect:
- Speak with an accountant about exactly how much you need to buy the business. The accountant will help you figure out how to negotiate a loan that serves your best interests.
- Make sure both parties fully understand and agree to the terms of the loan.
- Have a lawyer draft a loan agreement, detailing every condition of the financing, like interest rate, financial reporting requirements, etc.
Vendor Finance Pros
- Avoid the banks– You won’t need to jump through all the hoops as with debt financing. If your credit isn’t where it should be or you are having a hard time securing a bank loan, vendor finance could be a great option.
- Avoid the investors– Retain your equity and the power of the business decision making. With vendor finance, you won’t have to forfeit any equity or power.
- Get to work faster– Usually, vendor financing will put you in business substantially faster than going with lenders or investors. You’ll make your own arrangements between the two parties and be able to start making money almost immediately.
Vendor Finance Cons
- Can be difficult to secure– Not every seller will want to provide a loan to fill the gap between the price they want and what you can afford. Vendor financing is not uncommon, but it isn’t usually preferred by the seller.
- The loan must be repaid– Just like the good old bank, you’ll need to make a deposit and pay interest.
- Mid-level risk– Usually, the café you want to purchase will serve as the collateral for a vendor loan. Ipso facto, the seller may take over if you miss any payments.
Next steps
Take each of these financing options into consideration and figure out which one will work for you and your business. You’ll need to take a lot into account, not just your finances. For example, you may have a friend already willing to lend you the money. But perhaps this person wants to be more involved than you’d like in the business.
Money, relationships, and your sanity are on the line, so take your time.
At the end of the day, it’s all about what you can afford and what puts you in a position to succeed. Do your research and fulfill your dream of owning your own café.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
Guide to National Quality Framework for Childcare Centres in Australia Click Here to view the current Guide to National Quality Framework for Childcare Centres in Australia. Are you interested in buying a Childcare Centre? Check out available Childcare businesses for sale here Businesses for Sale – Childcare Are you buying a business in Perth? Do you […]
Guide to National Quality Framework for Childcare Centres in Australia
Click Here to view the current Guide to National Quality Framework for Childcare Centres in Australia.
Are you interested in buying a Childcare Centre?
Check out available Childcare businesses for sale here Businesses for Sale – Childcare
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers.
Bankwest Future of Business: Focus on Childcare The report below was released by Bankwest in regard to the Childcare sector economic performance both now and future projections. bankwest-future-of-business-focus-on-childcare-3330136 It is very interesting reading for all Childcare owners and Childcare buyers. If you are looking to buy your first Childcare business or expanding in Perth this […]
Bankwest Future of Business: Focus on Childcare
The report below was released by Bankwest in regard to the Childcare sector economic performance both now and future projections.
bankwest-future-of-business-focus-on-childcare-3330136
It is very interesting reading for all Childcare owners and Childcare buyers.
If you are looking to buy your first Childcare business or expanding in Perth this report is a very encouraging and positive outlook.
Hope you find it useful and of interest.
4 tips to choose the right business for you When you go to buy a business, one of the key driving factors is financials. You want to make sure the business you’re buying or starting will be lucrative, that it will be able to generate a profit. But buying a business is a LOT more […]
4 tips to choose the right business for you
When you go to buy a business, one of the key driving factors is financials. You want to make sure the business you’re buying or starting will be lucrative, that it will be able to generate a profit.
But buying a business is a LOT more than just numbers.
Of course, be sure to do the proper due diligence (especially into the financials), but also take something else into account —
Yourself!
A big part —( if not the biggest) — of whether or not your small business will succeed will be determined by you. What are your skills and experience? What are you passionate about?
Self reflection on these questions is important to help you make the right decision.
If you choose a business that is best aligned with your personality, talents, and lifestyle, you’re more apt to succeed. Check out our 4 tips to choosing the best business to buy that’s a good fit for you and your skills.
1. Leverage your strengths and passions
If you choose a business to buy that involves something you have a talent for and/or you are passionate about, your strengths become an asset of the company. Think about what you excel at and what you enjoy doing. Get creative about ways that you can create revenue from what you want to do, i.e. buy or start a business.
If you are passionate about coffee and pastries, you may want to look into owning a cafe. Think also about your experience in various fields — even your personal experiences — that you can leverage to be a good business owner. This can help you determine an environment where you can thrive (and hopefully, your employees with you).
On a final note, don’t neglect practical realities. If you purchase a business, you won’t have to start from the ground-up. Buying a business as a new business owner can often be more advantageous in terms of financing, time, etc.
2. Be real with yourself.
Take an honest look at areas where you lack expertise or need improvement. Know your limits and know when you will have to delegate/outsource. Starting a new business, whether you buy one or begin from the ground-up, and running it successfully is one of the most rewarding experiences there is.
But it can also be highly demanding, so make sure you’re willing to take on a high level of responsibility and accountability.
Maybe you’re passionate about fashion but have no experience in the retail industry; perhaps going the managerial/ownership role is wrong for you. If you prefer not to work on the weekends or early in the morning, buying a cafe probably won’t suit your lifestyle.
It’s important that as a business owner, you can fulfill your lifestyle expectations while still putting in the large amount of work it takes to operate a business.
Your personal and professional qualities are also a big part of what will make things go roughly or smoothly. Be real with yourself about your strengths and weaknesses, skills, and experience. Find out where the gaps are and how you can fill them. Often, fine-tuning your skills or investing in learning new ones will pay big dividends as a small business owner.
3. Consider the options and find the right fit.
Depending on your skill set, experience, and personality, it’s possible that many businesses match what you have to offer and what you’re looking for.
Be sure to really consider all the options on an analytical level; you can do this according to income, time spent working, etc. It’s a good idea to layout a simple list of pros and cons with each option, too. You’ll be able to visually see what you’ll be dealing with that’s not ideal for your lifestyle, how much you can handle, etc.
Also, think about what is important to you and how you value your time. Some people are happy to put in 40+ hour work weeks and beyond for the right price; others prefer to work less. Some prefer to work in teams versus solo, etc.
Finally, finding the right fit for you means aligning your professional and personal strengths with a business that will be profitable and fit your lifestyle. Remember, you can’t be good at everything; don’t let a lack of knowledge or experience intimidate you.
For example, you could purchase a franchise business known for their full support in marketing, accounting, branding, etc.
Your skills, your budget, and your strengths will ultimately determine the right fit. When all those come together in a compatible way, you’ll know you’ve found the right business for you.
4. Research! Research! Research!
Once you know the industry that fits you or the business you’re confident will align well with what you have to offer, it’s critical to research as much as you can. You need to use tools like the ATO Small Business Benchmarks to see how your particular sector is doing. This can help you learn about larger market trends, how they may or may not affect your business, or if they’re total deal breakers.
Make sure to:
- Clearly identify and research your potential customers, or current customers if purchasing a business.
- Learn the ins and outs of your competitors; the more information the better.
- Learn more about the industry itself, consumer trends, products, etc.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
Learn about pricing regulations Businesses have certain rights and responsibilities when setting and displaying the prices of their goods and services. When you price your products or services, or advertise a price, you need to comply with a number of regulations. Below are a few terms to become familiar with. Comparative pricing – Comparative pricing is […]
Learn about pricing regulations
Businesses have certain rights and responsibilities when setting and displaying the prices of their goods and services. When you price your products or services, or advertise a price, you need to comply with a number of regulations. Below are a few terms to become familiar with.
Comparative pricing – Comparative pricing is where you compare the sale price of a product or service to a former price.
Recommended Retail Price (RRP) – RRP is only a recommendation to the re-seller. It’s illegal for a supplier to pressure a re-seller into selling their products at or above a certain price, or threaten to cut off supply if their price demands are not met.
Price fixing – Price fixing is where two or more competitors agree on setting prices. Price fixing is illegal in Australia. This can be often confused with parallel pricing, which is a legitimate way of setting prices.
Multiple pricing – Multiple pricing is when a good is advertised with more than one displayed price. Typically, this is done in error. Under consumer law, a business must either sell the goods at the lower price, or withdraw the good from sale until the price is corrected.
Unit pricing code – Unit pricing is when a per unit price is calculated for a product using a standard measurement such as litres or grams. Unit pricing allows customers to compare the price and value of similar types of products. Under the unit pricing code it is compulsory for grocery retailers to display both a product price and a unit price for certain grocery items.
Different pricing for payment methods – Charges for different payment methods (e.g credit card surcharge) must be clearly labelled.
Set yourself up for success If you take the right steps and put your time to good use, you can set yourself up for major success. This means cutting costs, reflecting, and planning. And for small businesses, growth is everything. You need to make sure your processes and people are solid enough to take […]
Set yourself up for success
If you take the right steps and put your time to good use, you can set yourself up for major success.
This means cutting costs, reflecting, and planning.
And for small businesses, growth is everything. You need to make sure your processes and people are solid enough to take on more business the following year, i.e. more revenue.
If you want to grow your business next year, take this time period to tee up what you’ll need for a successful 2021. Here are our tips to drive your business growth to a new level.
1. Reflect
Take time to reflect on the previous year, both alone and with one or a few team members. Think about the highs and the lows, the challenges you overcame (and why), and any challenges that are still there. In terms of products and services, look closely at the numbers. What was the most popular? Which generated the most revenue? What were the losers? You get the point. Afterward, type a document of these notes that you can use year-round when a problem or opportunity presents itself. Reflection is key to innovation and growth, so before you do anything else, take this important step.
2. Review your relationships with your vendors.
Now is a great time to shop around to find the best prices with suppliers. Take a look at your monthly expenditures with vendors, from suppliers to internet service providers, and see where you could save money by switching. If you can get started as early as Black Friday, many web hosting companies and other software providers offer fantastic deals to get you started on their platforms. This may take time to look into the competitors for all your vendors, depending on how many you use. But the money you could potentially save on a yearly basis will be well worth it.
3. Think about growing your business.
How can you increase your brand awareness? Simple things like improving/optimizing your website and having a social media presence can translate into more sales and revenue. Think about how you can put different channels and spheres of influence together to gain more customers and reach more people. If needed, you can use profits from the following year to invest in improving your brand outreach and revenue by hiring professionals in SEO or digital advertising.
4. Put your profits to good use.
Use those extra dollars you may have earned during the holiday season to do as suggested above and hire advertising professionals. Or you might want to invest in new equipment, new personnel, or a new location to help grow your business. At the end of the day, make sure some of your profit is going back into your business to keep it growing and thriving.
5. Budget for the entire year.
We know, it’s tedious. But getting your ducks in a row financially BEFORE the next year starts is critical for small businesses who usually don’t have deep coin purses if revenue slows. Figure out your spending NOW. You’ll be happy you did later.
And hopefully by following our steps, you will be able to plan financially for the year with positive projections from cutting unnecessary costs and growing your brand. Happy holidays!
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
Future-proofing your business No one can predict the future, but you can be prepared for whatever it may throw at you.In business, there are some proven steps, that can help make your future as successful and as stress-free as possible. How can small business owners future-proof their business? The key to success comes from […]
Future-proofing your business
No one can predict the future, but you can be prepared for whatever it may throw at you.In business, there are some proven steps, that can help make your future as successful and as stress-free as possible.
How can small business owners future-proof their business?
The key to success comes from knowing your numbers. You need to be profitable, and you need to set yourself measurable goals to help you grow each year. It’s quite simple, and it comes down to a few critical steps.
It can be hard to do the work to plan when you’re doing everything yourself – how would you approach finding help?
It’s possible to do your books on your own of course, but everyone needs a good accountant, and you need to make sure that the accountant is working in your best interest.They should be thinking about your accounts in April/May, and you should be getting a plan together to tackle tax and plan for the future early on.Working with a good bookkeeper can help you if you’re not into advanced analysis or predictions.Plugging numbers into a spreadsheet is one thing but sitting down and analysing them and figuring out where things went wrong is another. If you’re not comfortable with these tasks, get yourself a bookkeeper who can help.
Something a lot of businesses have trouble with is the concept of setting goals – which is crucial to future planning. Any tips on how best to approach this?
Many business owners want to earn more, but they don’t break it down into how they can do it. They also don’t have a reason behind their goals.I think this is an essential step – there has to be a desire there to achieve and knowing why you want to improve revenue or go global helps you stick to your goals.
Source: MYOB
Business Registration Service – start your business in just one place! The Government has launched the Business Registration Service (BRS) , with over 2,000 companies and nearly 11,000 business names registered using the new service to date. BRS has significantly reduced the time needed to apply for business and tax registrations, removing red tape and making it […]
Business Registration Service – start your business in just one place!
The Government has launched the Business Registration Service (BRS) , with over 2,000 companies and nearly 11,000 business names registered using the new service to date. BRS has significantly reduced the time needed to apply for business and tax registrations, removing red tape and making it easier to start a business. For the first time, you can use BRS to apply for an Australian company online directly.
With BRS, you can apply for:
- an Australian Business Number (ABN)
- an Australian company
- a business name, and
- Goods and services tax (GST).
Business.gov.au has also developed a new ‘Starting a business’ guide , that walks you through the process of starting a business in Australia.The guide will help you to:
- prepare and plan to start a business,
- understand what is required and what is optional when starting a business, and
- understand key business and tax registrations.
Article Compliments of www.asic.gov.au
5 Reasons to Buy a Business vs Starting from Scratch Are you an aspiring business owner? Do you want to work for yourself and own your own company? The benefits of being a business owner attract all types of people to put in the time, work, and money to make it happen. But perhaps the […]
5 Reasons to Buy a Business vs Starting from Scratch
Are you an aspiring business owner? Do you want to work for yourself and own your own company?
The benefits of being a business owner attract all types of people to put in the time, work, and money to make it happen.
But perhaps the biggest question at the beginning is this —
Should you start a business from scratch? Or buy a business?
Obviously, there are arguments on either side, but for most, buying a pre-existing business is the most advantageous option.
Unless you have millions to blow on a startup or a revolutionary idea with the capital to back it, chances are you will fare better buying a business that’s already up and running.
Check out our 5 Reasons to Buy a Business vs Starting from Scratch.
1. The business is ready to go!
With the exception of some tweaks you may want to put in place, buying a business already in operation means that the engine is already running — you’re just getting the keys to the car!
When buying an operating business, the seller will simply transfer ownership to you. All the equipment, supplies, the website, etc. are ready to go. You can implement the changes you want as you want to make them.
When starting a brand-new business, owners spend a lot of time and money on design, supplies, and expensive equipment. Usually when purchasing a business, equipment is valued lower than the purchasing price, so you get a bargain along with saved time and stress.
2. Branding
To go along with the ready-to-go aspect, a huge headache you save when buying a business versus starting one is the hurdle that is branding. The branding of a business involves everything from website and logo to the colors you use and the tone of voice you employ in your written materials.
People pay top dollar to marketing professionals to execute a branding strategy. It can often be a costly and frustrating endeavor if you don’t find the right people or don’t have a good idea of how you want your brand to ‘feel’.
If you’re buying a business that’s already operating, already successful, then you know the branding works!
You don’t have to go through the exhaustive process of finding out how you want your brand to sound, feel, and look. The work’s been done for you.
That said, sometimes new owners want to take the brand in a new direction and will purposely buy a business with the intention to rebrand. Even doing this will save time and money, since you’ll have a base to go by. You can figure out what works and what doesn’t from there.
3. Market Tested
When you buy a business that’s established, you’ll have a solid sales history to look at. You’ll be able to see how the business has been performing according to the cold, hard numbers. You can figure out what products and services work and which ones you should toss.
You’ll also be able to see what can be improved upon because you’ll have a definitive benchmark, a starting point with a chunk of data to work with.
On the flip side — If you start a business from scratch, it can be difficult to accurately project how your business will perform.
Startups engage in expensive market research and analysis to figure out how they think they will fare in the current market. Or worse, they do minimal research and wing it.
With an established business, the market research has already been completed, and the proof lies in the financial history. No outlandish projections. No overhyping. Just solid data that can give you the assurance you need to make an investment.
4. Established Customer Base
Perhaps one of the biggest hurdles every new business owner faces is getting customers and keeping them. It costs significantly more to obtain a new customer versus retaining an existing one, so customer loyalty cannot be undervalued.
When buying a business that’s up and running, your established customer base is already there. You already have a reputation you can build on. People already know what you do and where to find you. Getting to that place takes countless hours and serious cash, time, and money you’ll be able to apply elsewhere.
5. More Value
At the end of the day, buying a pre-existing business tends to be kinder on the wallet than starting from scratch.
We already touched on this with equipment —
When you buy an established business, let’s say a cafe, the equipment you purchase will not be valued at the buying price. You essentially get to purchase the supplies at a fraction of what they cost in the marketplace.
You can usually see ROI more quickly by buying a business than with a startup.
Also, it’s much easier to get financing when purchasing a business versus starting from scratch. Investors and financial institutions are much more comfortable with solid data from sales history than projections from an untested company.
Next Steps
If you want to be in business for yourself, you need to be sure you’re ready for the time, the investment, and the large amount of work it will require. That said, the freedom of being your own boss is what draws most to business ownership in the first place. You can make your own hours and create your own path.
Now, it’s time to decide whether you want to start a business from scratch or buy a business that’s already up and running. At the end of the day, it’s simply less risky to do the latter.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
Childcare Benefit Information from 01 July 18 The following videos cover the improvements and changes to the Childcare Benefit system effective 01 July 2018. Top 3 ways your child care is about to get cheaper (Please click HERE to view the video) How your child care is about to get cheaper (Please click HERE to […]
Childcare Benefit Information from 01 July 18
The following videos cover the improvements and changes to the Childcare Benefit system effective 01 July 2018.
- Top 3 ways your child care is about to get cheaper (Please click HERE to view the video)
- How your child care is about to get cheaper (Please click HERE to view the video)
- Child Care Changes – Subsidy (Please click HERE to view the video)
- Child Care Changes – Scrapping the Cap (Please click HERE to view the video)
Child Care Changes – Safety Net (Please click HERE to view the video)
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
Childcare Snatches Star status Why buy a Childcare Centre? Exponential rental growth in childcare assets is outstripping that of all other property sectors, creating a new “golden child” of property investment and prompting a rash of research. It was declared that childcare centres are Australia’s fastest growing commercial real estate investment class, underpinned by the […]
Childcare Snatches Star status
Why buy a Childcare Centre?
Exponential rental growth in childcare assets is outstripping that of all other property sectors, creating a new “golden child” of property investment and prompting a rash of research.
It was declared that childcare centres are Australia’s fastest growing commercial real estate investment class, underpinned by the fact that the economic benefit of workforce participation far outweighs the costs of funding assistance for childcare
Also, most of the federal Government spending in this sector, tipped at $8.8 billion in 2018-2019 and $10 billion by 2019-2020, was paid directly to childcare operators, ensuring operators can pay the rent.
Reason why childcare should be at the top of every investors wish list
- With sharp yields in the current low interest rate environment and excellent lease conditions, childcare centres are Australia’s most desirable new investment class.
- Demand to purchase is high as both local and interstate investors can see the value and attractive yields still on offer
- Childcare assets have a greater ease in obtaining financing, than say service station business and other service businesses
- Childcare centres were seen as higher-yielding lower risk investments, creating a “ growing pool of buyers hungry for childcare business and property investments”
- The long term need for childcare across Australia adds urgency and interest to this somewhat new asset class
{Source: The West Australia}
Hiring a Business Broker to Buy or Sell Your Business Selling a business is not a simple and straightforward process. It requires time, money, negotiation, and a high level of savvy to walk away with what you expect, or at least something close to it. If you’re interested in selling your business, hiring a professional […]
Hiring a Business Broker to Buy or Sell Your Business
Selling a business is not a simple and straightforward process. It requires time, money, negotiation, and a high level of savvy to walk away with what you expect, or at least something close to it.
If you’re interested in selling your business, hiring a professional to guide you through the process is one of the best decisions you can make.
Whether you want to sell your business or you are interested in purchasing a business, a business broker is an excellent way to protect your interests and even save money in the long run.
So, what exactly does a business broker do?
A business broker acts as an intermediary between the buyer and seller. Business brokers are experts at selling businesses, and the best ones will have intimate knowledge of the industry sector they specialise in.
Going it alone when selling a business is a cumbersome task. Check out the benefits of hiring a business broker to minimize your risks.
Marketing Expertise
Adept business brokers usually have fantastic marketing and advertising skills. They will know exactly how to present your business, where to present it, and the right people to present it to.
Savvy business brokers will utilize online platforms to market your business, including buy/sell sites and even social media. Plus, they should have long-standing connections within your local market, so they’ll have an idea of the right people to contact.
Your business broker will have intimate knowledge of what buyers are looking for. They will help make the necessary changes as to how your business is presented to buyers to help you get the price you want.
No Emotional Attachment
No matter how business-minded a seller might be, nearly all business owners have some sort of emotional attachment to their businesses.
And rightfully so. For many, the business is like a child, something they have nurtured, grown, and invested heavily in. Getting emotionally attached to your business is not necessarily a bad thing.
However, in the selling process, you need someone on your side who lacks emotional attachment and is able to make steadfast decisions based on cold, hard numbers and facts.
A business broker is the emotionally detached third party that can set you straight and keep the selling process moving forward.
Confidentiality
A business broker can protect your business by only providing information to pre-qualified buyers who have signed a confidentiality agreement.
Since this is their specialty, they’ll be able to save you time and money by screening prospective buyers for you. An experienced broker may know right off the bat if someone isn’t serious, and that kind of intuition will serve you well throughout the selling process.
Reach More Buyers
If you decide to sell your business on your own, you’ll probably have a limited list of prospective buyers to reach out to.
Business brokers have loads of tools, resources, and connections at their disposal to reach a wider base of buyers. Brokers have a database of prospective buyers they will be able to connect with. They may have national or even international contacts you wouldn’t expect.
Mind Your Own Business
By hiring a business broker to handle the selling process, you can focus on your own business. Eliminate the stress and anxiety of multitasking and keep your eyes on your own source of income. More often than not, letting a broker do the work for you will save you money in the long run.
Negotiating Skills
A business broker with killer negotiating skills is worth their weight in gold.
Most experienced brokers will have developed these skills in the course of selling multiple businesses. The result? A deal that supports your best interest.
Sale Price
Each business has anywhere from dozens to hundreds of variables that bare weight on an appropriate sale price. Unlike valuing a home or car, the process of placing a value on a business is much more complicated.
However, like valuing a home or car, the right sale price will maximize your financial outcome. Asking for too little can undermine your business’ value, while aiming too high can turn off buyers and ultimately devalue you.
Business brokers will know the sweet spot, the right price to optimize your profits. They also will utilize business transaction data to use as reference points to issue the best sale price.
Get the Right Buyer
It’s not about getting a buyer. It’s about getting the right buyer.
The right buyer will be the one who satisfies your expectations and values your business appropriately. To find the right buyer, your business broker will know the proper questions and ways to vet prospects, so that your time and money is not wasted, and the right buyer comes calling.
A business broker will find the right buyer that will put you in the best position to negotiate and reach your financial goal without the headaches and stress.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
How to Keep Your New Employees Happy Buying a pre-existing business has many advantages over beginning from scratch. For starters, you can generate income from day one. Another giant benefit is a built-in employee base. If you’re purchasing a thriving business with a solid team, there’s a good chance good employees are the reason behind […]
How to Keep Your New Employees Happy
Buying a pre-existing business has many advantages over beginning from scratch.
For starters, you can generate income from day one.
Another giant benefit is a built-in employee base. If you’re purchasing a thriving business with a solid team, there’s a good chance good employees are the reason behind the company’s success.
You’ll want to keep the employees of your new business happy and foster strong relationships with each of them —
Happy workers are productive ones!
At the onset, a bit of anxiety on both sides is understandable. You’re new to the business and the personal dynamics of the team. Team members may be anxious about changes and possible personality conflicts.
However, if you focus on building relationships with your new employees and engender trust, you can supercharge your business with new energy that revitalizes the staff and increases your profits.
Check out our tips on how to buy a business and keep your new team members happy.
1. Set (reasonable) expectations.
Each employee should clearly know exactly what is expected of them at the workplace.
Attack any vague areas or concerns with open communication and active listening. The more your employees are clear on exactly what you expect, the better they can deliver.
An effective motivating tool is the performance review. You can conduct these every three months, six months, or once per year for long-term employees. If there isn’t a periodic performance review schedule in place, it’s a good idea to add it in to the mix.
Staff can have mixed reactions to these reviews, but it’s a great way to monitor progress and see who stands out.
Many small business owners offer financial incentives to motivate staff and sweeten the deal. For example, you may conduct a performance review once every six months and annually offer the opportunity for a raise.
Performance reviews are also a fantastic method for you as a business owner to monitor your own progress. By encouraging your employees to disclose their thoughts on the company, you can foster a trusting relationship with them and work on how to make the workplace even better.
2. Don’t reinvent the wheel.
When you’re buying a business, it will come with its own pre-existing strengths. While it may be tempting to put your stamp of authenticity in every nook and cranny — after all, the business is now yours — don’t reinvent the wheel.
If the business is thriving in one area, don’t go out of your way to change it. Keep what’s working and assess areas that are not.
By all means, you have every right as the new business owner to shake things up in weak spots. Just try not to throw the baby out with the bathwater.
If you try to change everything right out the gate, your employees will probably resent it. Change is a difficult transition for most people; so, make changes when needed and don’t reinvent the wheel.
3. Promote a sense of ownership.
You don’t want your employees to feel like they are simply means to an end.
The more sense of ownership employees feel, the better they will perform and the greater pride they’ll take in their work.
A great way to instill a sense of ownership is to lead by example. Show your new employees the way you want them to perform by doing a great job yourself.
Another way to foster a sense of ownership is to stay actively engaged with your staff.
Ask for their help on how to make things more efficient and the work environment more positive. This lets your new employees know that you are invested in them and value their input. Plus, they will probably have a better understanding of the day-to-day operations of the business, since they’ve been at it longer than you have.
Staying engaged with staff as an owner will alert you to issues before they develop into bigger problems and keep you ensconced in the daily life of your company.
4. Host team-building or social events.
Foot the bill for an office happy hour every other month. Invite the staff to a cooking class. The social possibilities are endless!
Whether you do it a lot or a little, hosting social events is a great way to foster connection between you and your employees and between employees themselves.
Additionally, you can hold team-building events that are designed to promote communication and personal connection among your employees. These can range from boring to challenging and fun, so do your homework and ask your employees for input.
5. Show your appreciation.
Praise is a great motivator and the perfect way to create a positive working environment. If someone is performing at a high level, showing great leadership, etc., point it out and even reward it.
As far as rewards go, there are the obvious financial incentives like raises, bonuses, etc.
But never underestimate the power of verbal praise.
Simply letting someone know that you value them as a team member and appreciate their hard work will go a long way.
Periodic performance reviews are an excellent segway to show appreciation in more ways than one.
Remember to stay positive!
No matter what, as a new business owner, your employees will look to you for direction. Your attitude, work ethic, and mood will be mirrored by those around you. Remember to stay positive and you’ll be on the right track to winning over your new employees.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
How to be a Successful Cafe Owner **This article is based on a chapter titled Attributes of a Successful Cafe Owner from Craig Reid’s book The Complete Guide to Buying a Cafe. You can purchase Craig’s helpful books on his website www.thecafeninja.com Are you thinking about buying a cafe? Cafes can be highly profitable businesses, but […]
How to be a Successful Cafe Owner
**This article is based on a chapter titled Attributes of a Successful Cafe Owner from Craig Reid’s book The Complete Guide to Buying a Cafe. You can purchase Craig’s helpful books on his website www.thecafeninja.com
Are you thinking about buying a cafe?
Cafes can be highly profitable businesses, but many enter into the game with little foresight into what it actually takes to run a successful cafe.
It’s not the light-hearted movie scene.
Running a cafe takes hard work, determination, and high-level people skills. Plus, you have to factor in things like location, market research, etc.
If you’re thinking about buying a cafe, you’ll need to get a good grip on your strengths and weaknesses. Management style is everything, and it will determine how employees, customers, and vendors interact with you and each other.
We love Craig Reid’s book The Complete Guide to Buying a Cafe. So, we’ve taken some snippets from his chapter on what makes a cafe owner successful to help you determine if it’s the right path for you.
Check out the following questions and see how you measure up.
Are you an organised person?
Running any successful food and bev operation requires a high level of organisation. And time management skills are critical in a good cafe business owner.
Why?
You need to make sure your vendors and staff are paid on time. You need to make sure you have sufficient supplies to get you through each week, each day. There are obviously numerous other day-to-day tasks involved like advertising and even resolving employee disputes. All of these require organization and time management skills.
If you don’t necessarily have amazing organizational skills, but you know the right tools to help you stay focused and productive, you are on the right track. As long as you can channel your duties into some sort of organized format, you’ll make it in the cafe business.
Plus, cafe financials are not as simplistic as you might think. In order to cope with the various accounts and monies constantly up in the air, you’ll want to make sure your numeracy skills are superb.
If they’re not, it doesn’t mean you necessarily shouldn’t own a cafe. It just means you’ll have to get your hands on the right tools and perhaps, the right people (hire an accountant, for example) to make sure you have a consistently good grip on the financial state of your business.
Are you a people person?
This one’s a biggie.
Probably the most important facet of your life as a cafe owner is your relationships with your customers and your employees. The people skills of an owner can transform a struggling business into a success or sink a ship. It all depends on you.
It doesn’t matter how amazing your coffee is, how great your sandwiches taste.
If people do not enjoy coming into your space, if they don’t feel welcomed by friendly faces, your business won’t last long.
As a cafe owner, you’ll need to know how to deal with problem customers. You’ll either know (or learn) how to make sure everyone leaves happy, regardless of the issue that has arisen.
Same goes for employees.
Creating a positive environment for your employees will greatly impact your bottom line. When people are happy at work, it shows. That pleasant attitude extends to customers. People can feel it.
Part of being a people person is knowing how to cultivate meaningful relationships with others. If you can do that in a business setting, this just may be the path for you.
Are you a strong person?
We’re referring to both physical and mental strength here.
The food and bev sector requires old-fashioned manual labor. Even though you would technically be in an ownership position, make no mistake — you will be engaging in physical labor.
Customer service in a cafe is physically demanding. You’ll be on your feet for large amounts of time helping customers in the front of the house. And in the back of the house, cleaning and organising heavy boxes of produce, supplies, etc. will require physical strength and endurance.
Of course, you don’t have to be a marathon runner. But you need to be reasonably healthy and physically strong enough to endure the lifestyle of a cafe owner.
On to the mental side of things.
You’ll come across a generous amount of stress as a cafe owner. When things get busy, you’ll be under pressure to perform at lightning speed while still maintaining quality. When things slow down, perhaps seasonally, you’ll need to be able to deal with less revenue and making your money stretch.
If you are reasonably good at dealing with stressful situations, you’ll fare well.
Are you good with IT?
Admittedly, you’re not required to be an IT expert. But in order to run a successful cafe, you’ll need to at the least be IT literate.
Unless your cafe is in the jungles of Costa Rica with limited customers, you and your employees will probably be using software for your transactions.
These software packages simplify and organize your daily transactions for you. But you need to know how to use them proficiently!
The more adept you become at using your software, the more you’ll be able to have a good grasp on the daily financials. No call to the accountant needed.
You’ll also save money.
Wireless communication via the internet is cheap, and if you can get a good social media following, you won’t have to spend as much on marketing.
At the end of the day, you don’t have to be a tech whiz. However, the more you know about technological tools like certain software and social media, the more you’ll be able to leverage them to make running your business easier and more profitable.
Bottom Line- Which role makes the most sense for you?
So, you’ve made it through the questions and feel confident you have what it takes to run a successful cafe.
Congratulations!
Now you can move on to the more fun stuff. But first, try to get a handle on what role(s) will make the most sense for you.
If people skills are your strongest suit, staying at the front of the house and dealing with customers is where you should be.
If you’re really good with tech, be the one who finds the new tools, posts on social media, and trains employees how to use the latest and greatest tech goodies.
In areas where you are weaker, this is where you’ll need to delegate. Get a good group of people around you with various strengths, and you’ll be on your way.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
5 Tools to Help You Increase Your Productivity As business owners, we work for ourselves. There is no one to hold us accountable for the work we have to accomplish everyday — no one except for ourselves. Productivity is the lifeblood of a successful business AND a successful business owner. But with a world full […]
5 Tools to Help You Increase Your Productivity
As business owners, we work for ourselves. There is no one to hold us accountable for the work we have to accomplish everyday — no one except for ourselves.
Productivity is the lifeblood of a successful business AND a successful business owner. But with a world full of digital distractions, it’s becoming increasingly difficult to keep productivity on track.
In fact, a recent survey of UK office workers found that out of the typical eight-hour workday, the average employee only truly ‘works’ around three hours. That’s a pretty staggering statistic.
Whether you work four hours each day or eight, it isn’t how much you work, but rather how efficiently you manage your time. In other words, it’s all about productivity.
Business owners need all the help they can get to keep productivity high. That’s why we’ve compiled a list of our Top 5 Tools to Help Increase Your Productivity.
1. Stop trying to remember all your passwords.
We recommend this #1 brain hack for everyone, even those not running their own business.
These days we need a password for everything, from ultra-secure platforms like online banking to free subscriptions to digital news media.
You can do that thing where you create one password for everything. But of course, there are two major problems with going down this path. One, it’s not secure. AT ALL. And secondly, many financial institutions and other platforms involving currency exchange force you to change your password every so often, anyway.
To be more productive, start by not stressing about your passwords. There are three easy-to-use apps that will keep them all securely stored for you.
Our top pick is LastPass. It’s highly intuitive to use and conveniently will pop up everywhere you need it to. LastPass offers a free desktop option that is well suited for average Joes, but for business owners who have to wear more hats, we recommend the premium option. It’s just $12 a year! Premium has improved security, mobile capabilities, and even more memory for even more passwords. The app has awesome features such as auto-password changing if it detects one of your accounts has been hacked.
At $12 annually, every business owner can certainly afford it. And of course, write it off!
Runners up in the category are KeePass and 1Password. People love these apps too, so feel free to give them a go.
2. Bring in the digital task managers.
Want to make your daily to-do list more efficient?
Bring in the digital task managers.
These are really glorified to-do lists, but what makes them different is their ability to be shared digitally. You can send daily duties to multiple employees, and they can then provide input when tasks are accomplished. Digital task managers are excellent tools to keep you and your team on the same page.
The most basic and easy to use is Wunderlist. It’s totally straightforward: a to-do list everyone can learn to use in a matter of minutes. Share your lists among specific groups and organize everything into files of your choosing. Wunderlist is a favorite of students and families, not just business owners, for its intuitive interface.
For more advanced platforms to manage multiple lists and people, Basecamp and Hitask will be a better bet. These are more in-depth solutions that enable you to assign, organize, and manage people and tasks. In addition to the to-dos, you can exchange files between users, share calendars, and coordinate on projects. These are better solutions for managing bigger teams or more complicated employee structures, like multiple freelancers or contractors.
3. Bring in the digital finance managers.
Perhaps one of the most important productivity tools is one that helps you manage your business finances. Not everything can be left to the accountant. As a business owner, it’s crucial that you have a constant grasp of your financial state.
With these online budgeting tools for business, you can keep your grip on your finances without asking the bookkeeper.
We recommend FreshBooks and Expensify to start. Freshbooks is a comprehensive solution for small businesses (less than 50 employees). It will help you manage your invoices and expenses in an intuitive format that’s easy to use and understand. And their stats are impressive — customers apparently double their revenue within the first two years of using the app. Talk about productivity hack!
Expensify is a more simplistic platform. It has less capabilities but will work great for businesses with just a few employees or less. Expensify will manage all your receipts, invoices, expense reports, etc. so you can waste less time on mind-numbing paperwork.
If you want a totally comprehensive budgeting software, start out at Capterra. The site will help you compare multiple business software products according to your budgets, your needs, and the size and scope of your company. It’s a great place to start, especially if you’re looking to shell out more cash on serious budgeting solutions.
4. Take your CRM digital.
Effective Customer Relationship Management (CRM) is critical to keeping any business afloat, let alone successful. Keeping up with sales, customer interactions, marketing, and IT is no easy feat.
Don’t try to create a system yourself. And don’t hire someone to do it, either.
Instead, try an efficient CRM software that will organize every level of your sales funnel and keep you and your employees focused on more important things. Minimize miscommunication between employees and customers, and say hello to more productivity every week.
Our top picks are Zoho and Colabo. Neither are free, and no CRM software worth its weight will give away the goods for free. Zoho is more of a broad solution that organizes your sales trends and cycles. It’s easy to use and great for small businesses.
If you already use CRM software but want to up your game, then Colabo is the choice for you. Colabo gives you more targeted solutions and is highly rated among large and small businesses alike.
5. Efficiently store your files. Digitally.
Just because we’re storing everything online doesn’t mean we are any more organized than the days of the file cabinet.
And depending on the way you, your customers, and/or your employees are sharing files with one another, you could be wasting precious time.
You need to be able to share files rapidly and securely. For free.
Hands-down the best option out there is Google Drive. Google Drive offers you an immense amount of storage, intuitive organization, and lets you share files securely, the way you want to share them, (read-only, etc.) in seconds.
Dropbox is another great option, but Google Drive is definitely the one most people are using.
If you want a higher level of security for your team and deal a lot with sensitive information like financial records, we recommend getting your team set up with Huddle. Huddle isn’t free, but it’s affordable. Depending on the nature of your business, it may be the best option.
Are you buying a business in Perth? Do you have a Perth business for sale? For more information on how you can get the best results, contact Angela at Advance Business Brokers today.
WHAT THE HELL IS THE PPSR? Let’s take a hot minute to discuss the PPSR and how you can leverage this tool to protect your business. We’ve top-lined a previous article you can find here. Check out how the PPSR can safeguard your assets and why you should consider it now. Not later… What exactly […]
WHAT THE HELL IS THE PPSR?
Let’s take a hot minute to discuss the PPSR and how you can leverage this tool to protect your business. We’ve top-lined a previous article you can find here. Check out how the PPSR can safeguard your assets and why you should consider it now. Not later…
What exactly is the PPSR?
The PPSR stands for the Personal Property Securities Register. By registering with the PPSR, you can provide your business with comprehensive risk protection. It’s also an effective tool for raising capital. If you ever need to raise funds for your business, it can also help you reach your goals by listing your goods and assets.
How does the PPSR protects your business? • The PPSR protects your business when purchasing goods.
• The PPSR safeguards the process of selling goods on retention of title or consignment.
• The PPSR protests your business when renting, leasing, or hiring out goods or services.
Here’s a tip: don’t rely on your contract’s retention of title clause, or you may be bitterly disappointed.
Purchasing Goods
Eliminate the mystery behind what you’re buying. You can search the data in the PPSR to find out if the particular goods you want to purchase are being used as security for an obligation like a debt. You won’t be able to see the exact value of said debt or obligation. However, the register will tell you to whom the obligation is owed, so you can investigate further.
Here’s an example. Someone wants to sell you used goods, let’s say a valuable piece of machinery you can use for your business. They conveniently fail to mention that they still owe finance on it. It’s not paid in full, even though they tell you otherwise. If this individual stops making payments on their loan, the financing company can come knocking on your door. They can legally take that precious piece of machinery away without reimbursing you. It’s money down the drain, and it happens more often than you might think.
For just $3.40 you can make sure that whatever you are purchasing is completely safe from repossession and free of financed debt. Take the extra five minutes out of your day to protect yourself.
Sell Goods on Retention of Title or Consignment
When you register with the PPSR, it demonstrates to interested buyers that you have an interest in the assets or goods you are selling on retention of title terms. Either that, or you have consigned the goods to a third party to sell on your behalf. This registered interested indicates that the assets or goods secure the obligation owed to you. It safeguards your interest in the assets or goods in case the payment goes into default or the purchaser goes broke.
Let’s say you don’t register those assets or goods. If the purchaser goes broke before paying you in full, your property could in fact be sold to pay the secured creditors upfront. If you do not register, you will be considered an unsecured creditor in the event of an insolvency. The odds are small that you will recover a substantial amount, if any amount, of what you are technically owed.
As you can see, the risks of not registering with the PPSR are considerably high.
The best thing to do is register as early as you can. This will mean that you will have the best chance at getting ahead of the other creditors in line. It will also enable you to protect your interest, regardless if the assets are mixed, sold on, or installed onto other goods.
Renting, Leasing, Hiring out Goods
If you have a hiring arrangement or lease with a term of at least 12 months or longer, or that is for an indefinite period of time, this is the section that applies to you.
By registering your assets with the PPSR, you can safeguard your vested interest when said assets are not technically in your possession. The registry will show that you claim an interest in the assets and/or goods will will be renting, hiring, or leasing out. If you fail to register and your customer becomes insolvent or goes broke, your assets and/or goods will probably be sold to pay creditors. And you’ll have to deal with the loss with no legal avenues for reimbursement.
If You Think You’re Already Covered by Your Contract…
The retention of title clause stipulates that the title will remain with you until the goods are paid for in full. Unfortunately, the retention of title clause in your invoice or contract will not protect you legally on its own. At least not any more. If you fail to register with the PPSR, the clause is highly unlikely to measure up against others, especially those registered.
Ipso facto, anybody who has registered an interest with the PPSR is in front of you in the queue if your customer ends up defaulting or going broke.
For all the business owners out there, registering with PPSR is a no brainer. Protect your business today and find out more here.
Have you considered buying a childcare business in Perth? The childcare business in Australia is booming. With more and more families functioning on dual incomes, the rise of single motherhood, and rising costs for in-home care, childcare centers have become highly profitable businesses. This article here provides all the staggering numbers, with almost one […]
Have you considered buying a childcare business in Perth?
The childcare business in Australia is booming.
With more and more families functioning on dual incomes, the rise of single motherhood, and rising costs for in-home care, childcare centers have become highly profitable businesses.
This article here provides all the staggering numbers, with almost one million children currently enrolled in certified childcare centers throughout Australia.
The stats are based on an official survey conducted by the federal government that found there are around 15,000 childcare centers operating in the country and over 700,000 families utilize some form of childcare or daycare services every month.
The snapshot shows substantial growth in the sector. In 2013, an additional 22,400 children were enrolled in daycare versus the previous year. The trend continues to strengthen.
The government survey showed that a whopping one quarter of all kids in Australia ages 12 and younger are enrolled regularly in childcare. This is a new record for childcare in Australia.
A Growing Trend
Early Childhood and Childcare Minister Kate Ellis had this to say on the popular trend:
“What we’re seeing is more children accessing childcare in more services than ever before in our nation’s history. We’re creating a more flexible, affordable, accessible childcare system with higher quality standards, and families around Australia are rightly taking advantage.”
In fact, Australia is one of the world’s leaders in federal financial support for childcare. Unlike many other nations, we can receive assistance for childcare expenses, which can add up to tens of thousands of dollars per year.
The Australian government just issued a record-breaking $20.6 billion for direct childcare assistance. They upped a 30 percent rebate to 50 percent for families’ out-of-pocket expenses, according to Ellis.
It’s important to note that although the numbers are up, Ellis claimed there are still a lot of obstacles with childcare availability. Although the government incentive is attractive, many have trouble finding a center near their home or office. Or oftentimes, enrollment has already been filled and parents are stuck with more challenging options.
Why you should buy a childcare business
- Individual childcare businesses are currently selling for 3.0 – 5 x net profit – one of the highest returns for any business.
- Childcare centre groups are selling for 5 to 6 x net profit which is getting close to Public Company sale multiple levels.
- Employee wages are relatively low compared to some other industries and usually the industry does not experience problems obtaining staff from Managers to Certificate III workers. Several HR agencies specialise in Childcare.
- In Australia over 50% of first time mothers re-enter the work force by the time their child reaches 1 year old, making childcare a necessity for the majority of parents with children under the age of 5 years.
- Government subsides – Centre’s can receive up to 80% of their fees direct from the Government. This can depend on location, size of the centre and income of parents.
- A 30 year old client, who built up a group of 19 centres (in Perth) over a period of 10 years, sold them in 2014 for $64 million.
- There are savings in numbers – once you reach around 5 centres+ – central administration can represent considerable savings in insurance, payroll, staff management, centre management (leases, marketing, advertising, cleaning, repairs & maintenance etc.).
- Administration work can also be handled from anywhere and by a team of people not necessarily associated with childcare.
- Opportunity to buy nationally outside of Perth and possibly manage from established administration base in Perth or elsewhere.
- Freehold centres are also available sometimes. Freehold can represent a saving both from a tax perspective and commercial rent. With interest rates at current record low levels the interest on a commercial loan usually works out cheaper than the equivalent in commercial rent costs. It also means any improvements to the Centre are adding to the commercial value of “your” property and not someone else’s. Opportunity for commercial gain on the property.
- Freehold ownership also means that when you want to sell your business you have far more control. You are not in the hands of a Managing Agent or landlord as to whether they will approve your buyer.
- Childcare centres are one of the few non-franchise businesses that Banks will lend on. The usual lend is 50% for a leasehold business and up to 70% of the overall cost for a Freehold centre. Links to recommended finance brokers and Bank Childcare specialists are available on my website.
- Currently many leasehold centres sell within weeks of coming on the market.
- Many other businesses can be linked, associated with Childcare.Sound secure investments.
- Finally they are sound secure investments.
Want to find out more about selling or buying a childcare business in Perth?
Contact Angela today at Advance Business Brokers for more information.
Buying a business in Perth? Once you have decided to purchase a business, it is very useful to draw up a list of questions to ask your business transfer broker or directly to the seller that will help you make your decision. The more information you gather, the more you will feel comfortable with making […]
Buying a business in Perth?
Once you have decided to purchase a business, it is very useful to draw up a list of questions to ask your business transfer broker or directly to the seller that will help you make your decision.
The more information you gather, the more you will feel comfortable with making a rational assessment of the business you are looking at.
At Advance Business Brokers we always spend time with each of our sellers to understand the exact nature of the opportunity.
Here are five questions that you should ask sellers before progressing with the purchase and signing a provisional contract.
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What is the primary reason for selling the business?
It’s crucial to understanding the true nature of the sale, the response to this question will help you assess the opportunity.
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How would the current owner recommend growing the business?
This is a great question to ask, especially if the owner is selling due to non-business reasons. An honest response will provide you with insight that could save you months of testing, research and investment.
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What are the business’ biggest challenges?
The answer to this question should help you avoid any unforeseen issues after taking over a business.
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How are the business’ processes documented?
Taking over a business with well documented procedures and processes in place will ensure that there are very little teething problems when you take over the business.
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What are the primary skills required to operate the business?
Discover the skills and leadership attributes that are most important to run the business. Honestly assess your current skills and see if you fit the profile. If not can they be learned or can you afford to recruit a manager with the skills to run the business.
Want to learn more about buying or selling a business in Perth?
For further information and advice on the next steps, contact Angela at Advance Business Brokers on 0416 109 017.
RESOURCES
CHILDCARE VALUERS
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OPTEON
Duncan Cameron | FAPI CPV, BSc, BBus (Val & Land Econ)
Director - Specialised & Advisory
D. 08 9488 4802
M. 0413 449 477
E. duncan.cameron@opteonsolutions.com
A. Level 2, 1 Hood Street, Subiaco, WA 6008 Australia
W. OPTEONSOLUTIONS.COM
Doug Shorten | AAPI CPV, BBS (VPM)
Senior Valuer
D. (08) 9488 4866
M. 0418 991 077
E. doug.shorten@opteonsolutions.com
MMJ Real Estate (WA) Pty Ltd
Chris Geers - Managing Director
Address: Level 6, 12 St Georges Terrace, Perth WA 6000
Phone: 08 9325 5880
Fax: 08 9325 5881
Mobile: 0410 493 057
Email: chris.geers@mmj.com.au
Web: www.mmj.com.au
CBRE | Valuation & Advisory Services
Rick Gismondi AAPI CPV | Valuer
Address: Level 25 | QV1 250 St Georges Terrace | Perth WA 6000
Phone: 08 9320 0058
Fax : 08 9481 1296
Mobile: 0416 194 227
Email: rick.gismondi@cbre.com.au
Website: www.cbre.com.au
Colliers
Richard Eddy | Director | Valuation & Advisory Services
Address: Level 26, 197 St Georges Terrace | Perth, WA 6000 | Australia
Phone: 08 9261 6630
Fax : 08 9261 6677
Mobile: 0478 876 843
Email: Richard.Eddy@colliers.com
Website: http://www.colliers.com.au/
NQF CHILDCARE AUSTRALIA
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CHILDCARE MANAGEMENT COMPANIES
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Some management companies that may be able to help you and will be able to provide a quote to manage your centre depending on the level of management required.
While we don’t recommend any particular management company, the following links from a Google search may be of assistance:
Elite Childcare Management
www.elitechildcaremanagement.com.au
Early Learning Management: Child Care Management System
Leading Edge: Childcare – Management, Consultant & Training
www.leadingedgechildcare.com.au
Giggletree – Childcare Management, Childcare Consulting, Childcare
Advance Childcare Management
Brisbane Childcare Consultants | Childcare Management Group
www.limelightmanagementgroup.com.au
Our Services – Foundation Early Learning
www.foundationearlylearning.edu.au
Impressions Childcare Management
First Years Consultancy
Roz Brabazon - 0437 894 432
CHILDCARE INFORMATION
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Childcare Resources
https://www.childcarecentredesktop.com.au/
Management Service for Enrollments/CCS for Childcare owners
Management Service for Enrollments-CCS for Childcare owners
Australian Children Education & Care Quality Authority (ACECQA)
http://www.acecqa.gov.au/regulatory-authorities1/contact-your-regulatory-authority
WA Department of Community Services Childcare
https://www.acecqa.gov.au/sites/default/files/2017-12/PA09_TransferofProviderDeclaration.pdf
Tel: 62103333
Education and Care Regulatory Unit (ECRU)
https://www.dlgc.wa.gov.au/LegislationCompliance/Pages/Education-and-Care.aspx
Provider Application (PA01) Including Police Clearance Provider
https://www.acecqa.gov.au/sites/default/files/2018-07/PA01_ApplicationForProviderApproval.pdf
Approval Declaration of Fitness and Property (PA02)
https://www.acecqa.gov.au/sites/default/files/2018-09/PA02_DeclarationOfFitnessAndPropriety.pdf
Childcare Subsidies for Childcare Business Owners
https://www.education.gov.au/child-care-subsidy-system
Designer specialising in Childcare property design for new or refurbishment of centres
SPH architecture + interiors
143 Cambridge St, West Leederville
08 9284 1888
ECT
Lynda Lewis <lynda@oncallect.com.au> - Provides assistance with ECT for childcare centres
SETTLEMENT AGENTS/LAWYERS PERTH
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Capital Legal Pty Ltd
Elisia Giardina l Solicitor
Office: Level 2, 43 Kishorn Road, Applecross WA 6153
Postal: PO Box 1062, Canning Bridge WA 6153
Work Tel.: (08) 9364 5444
Fax:(08) 9364 8444
E-mail: elisia@capital-legal.com.au
Website: www.capital-legal.com.au
WEST END SETTLEMENTS
Erica Settineri l Licensed Conveyancer/Director
Shop 6, 7 Scarborough Beach Road
North Perth, WA 6006
Work Tel.: 08 9443 3044 Fax: 08 9201 1392
E-mail: erica@westendsettlements.com.au
WA Property Lawyers
Stephanie Le Roux
Personal Assistant to
Brian McCormack, Corinne Adams, Eden Coad and Sarah Wright
Tel: (08) 9380 3600
Address: 96 Outram St, West Perth WA 6005
Email: info@wapropertylawyers.com.au
Greenstone Legal
Jade Lattimore
Director
Tel.: 0438 303 763
Web: greenstonelegal.com.au
Saint James Conveyancing
Marisa Durante-Maynard / Jill Nelson-Coulon
Tel.: (08) 9240 7525
E-mail: marisa@conveyancerperth.com.au / Jill@conveyancerperth.com.au
FS Legal Perth
Chandhi Hettiarachchi
Principal/ Solicitor
Five Star Legal. Unit 5/365 High Road, Parkwood WA 6147
Tel.: 08 6146 6282
E-mail: chandhi@fslegalperth.com.au
www.fslegalperth.com.au
Composite Law
Robert Ross - Director
Suite 4, 28 Outram Street, West Perth WA 6005
T: (08) 6162 2399
F: (08) 6162 2335
E: robert.ross@compositelaw.com.au
P: PO Box 7920, Cloisters Sq, WA 6850
www.compositelaw.com.au
Williams and Hughes
Greg Mohen - Consultant
Ground Floor, 25 Richardson Street WEST PERTH WA 6005
Telephone: +61 8 9481 2040
Facsimile: +61 8 9481 2041
Mobile 0431 992 841
Email: Greg.Mohen@whlaw.com.au
www.whlaw.com.au
FINANCE BROKERS
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ANZ
Brad Hewett
Relationship Manager • Commercial Banking – Health
Email: Bradley.Hewett@anz.com
Phone: 0468 578 241
Address: Level 5, 240 St Georges Terrace, Perth WA 6000
Towner Finance
Michelle Towner | Director
Winthrop & Mandurah
E: michelle@townerfinance.com.au
Ph: 08 9332 2554 | Mob: 0418 99 88 44
Bendigo Bank
Shaun Rigby - Business Banking Manager
Level 3, 225 St Georges Terrace, Perth WA 6000
E: shaun.Rigby@bendigoadelaide.com.au
m: 0427 355 458
Small Business Finance Lender
Liberty
Brett Foster
Tel.: 0438 775 570
E-mail: bfoster@libertynetwork.com.au
Able Finance
Jon Elliott
Tel.: 9328 3600
E-mail: jon@ablefinance.com.au
Southshore Finance
Mr. Steve Greenwood or Michael Coombes
Tel.: (08) 9474 1999
E-mail: steve@southshorefinance.com.au
Crediflex Finance
Adam Barbuzza
Tel.: 0439990946
E-mail: adambarbuzza@crediflex.com
Works with traditional and non-traditional lenders such as Liberty finance.
Chantal Sforcina - Senior Aussie Broker
Aussie Home Loans
Level 10, 28 Freshwater Place Southbank, VIC 3006
M 0410 074 966
P 03 9679 9333
E-mail: Chantal.Sforcina2@aussie.com.au
BANK FINANCE
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National Australia Bank
Diana Goh l Small Business Banker
Mobile: 0452 673 120
Email: diana.goh@nab.com.au
Level 12, 100 St Georges Terrace, Perth, WA,6000
MIGRATION SERVICES
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Rayford Migration Services
Website: http://www.rayfordmigration.com
Pauline Yong - Email:
Email Address: enquiry@rayfordmigration.com
Rayford Migration Services : MALAYSIA OFFICE
Contact detail:
Contact
Contact
Company detail :
Service provided :
188 and 132 information :
Rayford Migration Services : SINGAPORE OFFICE
Contact detail:
Contact
Contact
INSURANCE - BUSINESS
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Phoenix Insurance Brokers Pty Ltd / Johnson Insurance Brokers Pty Ltd AR 1283293 and Murray Johnson AR
Murray Johnson | Dip of Financial Services (Insurance Broking) ANZIIF (Snr Assoc) CIP |
Mobile: 0418 563 599
Phone: (08) 9754 2286
Website: www.phoenixins.com.au
Address: 5A Fairbairn Road Busselton WA 6280
PO Box 1448 Busselton WA 6280
AFSL: 229847
ACCOUNTANTS
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Marpik Accountants Pty Ltd
Mat Honner
E-mail: mat@marpik.com.au
Tel. (08) 9447 1003
Kim Ovard - Tax Accountants
Tax Agent 25333735
Unit 3A ,23 Edinburgh Avenue, Kinross,6028
E-mail: kim@kimovardtaxreturns.com.au
Tel. (08) 9305 5515
Foreign resident capital gains withholding clearance certificate application form (NAT 74883).
To access the form, visit ato.gov.au/FRCGW.
STOCK TAKERS - PERTH
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Associated Stocktaking
Stephen Moore
Unit 12-64 First Ave Mount Lawley WA 6050
Website: https://www.associatedstocktaking.com.au/
Tel.: 1300 559 004
GENERAL INFORMATION
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Building Inspector
Bestwest Building
Charlie Lewer l General Manager
Does Building Inspections for Childcare & Property
P: 08 9444 9562
A: Unit 6/59 Walters Drive, Osborne Park 6017
W: www.bestwestbuilding.com.au
E: office@bestwestbuilding.com.au
ABN: 50 143 759 611
Stamp Duty-WA
Department of State Revenue http://www.finance.wa.gov.au/cms/content.aspx?id=2055
Small Business Development Corporation
http://www.smallbusiness.wa.gov.au/
Lots of useful information and assistance for small business
Chamber of Commerce WA
http://www.cciwa.com/
Membership required but great resources for small businesses
Police and CV Checks
www.CVcheck.com
The Western Australia Police for National Police Certificate
https://www.police.wa.gov.au/Police%20Direct/National%20Police%20Certificates
Working with Children Check
https://workingwithchildren.wa.gov.au/
Withholding Tax for Foreign Investors Property Sales over $750,000
https://www.ato.gov.au/FRWT_Certificate.aspx
Above is the link to complete the form for the ATO in regard to the Clearance certificate application for Australian residents. As there is some confusion over whether this form needs to be completed for business sales at this time, all Sellers to please complete in case required for all business & property sales over $750,000 at time of signing contract.
BUSINESS AND COMPANY NAME REGISTRATIONS
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Panther Corp
Kristy Hubbard
Tel.: 9388 0551
E-mail: kristy@panthercorp.com.au
Easy Companies
Easycompanies.com.au
BUSINESS ADVISORS/BUSINESS PLANS
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Nick Hancock
M: 0450 144 139
E-mail: nick@nickhancock.com.au
www.nickhancock.com.au
Taral - Business Plans
Tax Accountant
UNIVERSAL TAXATION SERVICES
Tel : 08 9258 8137
Mob : 0433 930 744
www.universaltaxation.com.au
Business Plan Template
BOOK-KEEPING SERVICES
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Centauri Bookkeeping
Lidia Lovric Hrbut - Registered BAS Agent
M: 0408 192 895
T: 9571 8444
E: centauri@iinet.net.au
LEGAL SERVICES
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Composite Law
Robert Ross - Director
Suite 4, 28 Outram Street, West Perth WA 6005
T: (08) 6162 2399
F: (08) 6162 2335
E: robert.ross@compositelaw.com.au
P: PO Box 7920, Cloisters Sq, WA 6850
www.compositelaw.com.au
Williams & Hughes
Greg Mohen - Commercial Counsel
Ground Floor, 25 Richardson Street, West Perth WA 6005, Australia
Telephone: +61 8 9481 2040
Facsimile: +61 8 9481 2041
Mobile: 0431 992 8411
Email: Greg.Mohen@whlaw.com.au
ADVERTISING AND MARKETING
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PWD
Oliver Wood
Managing Director
D. 08 6146 0195
M. 0406 934 820
E. oliver@pwd.com.au
A. 3 Loftus Street, West Leederville, 6007
W. pwd.com.au
ARCHITECT
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Specialist in Childcare centre designs plans
RECHITECTS
Leo Chong | Architect Reg No.2465
Director
D. 08 9277 3393
M. 0433490048
E. leo@rechitects.biz
A. Level1, 6/6 Leigh Street, Burswood 6100 WA