An expected 7,400 qualified small to medium businesses in Western Australia will begin receiving the $17,500 one-off grant from the McGowan Government this week.

On Thursday, Finance Minister Ben Wyatt says, “We are very aware of the impact that the pandemic has had on local businesses and jobs, and we thank every business for playing their role in helping stop the spread of the virus in WA.”

The one-off grants will help them recover from the economic fallout due to the COVID-19 pandemic. There is no need to apply for the grant. It will be sent automatically to all qualifying businesses.

The subsidy is part of the over $2.3 billion COVID-19 stimulus and relief efforts of the state government to provide assistance to households and businesses.

Eligible businesses are payroll tax paying businesses with a payroll between $1 million and $4 million. They can be employers or a group of employers.

For employers not registered for payroll tax in 2018-19, their eligibility will be ascertained on their reconciled 2019-20 Australian taxable wages, with grants paid later in 2020. 

A special assistance centre has also been set up by the State Government through the Small Business Development Corporation (SBDC) to address enquiries from business owners regarding information on eligibility requirements and available support packages. SBDC also provides advice for businesses currently ineligible for financial aid packages.

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:

1. Check your credit and improve it if needed.
2. Thoroughly research all prospective loans and lenders, including the interest rate and time frame.
3. Set realistic expectations about whether or not you can pay the money back according to your business plan and projected profits.
4. 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.
5. Talk to an accountant to make sure you can afford the loan you need without putting yourself in financial jeopardy.
6. 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.

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}

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 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 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.