| So now its time to take that big plunge and be | | | | of the business!There are good and bad |
| your own boss. Where will I start? What do I look | | | | accountants just like there are good and bad |
| for? And for that matter what business will I | | | | brokers. It's important to check the licenses of all |
| buy? Will I relocate? Can I get finance? Who do I | | | | your professional people. Find out how long they |
| go to for the right advise?These are just a few | | | | have been in the profession and their experience |
| of the concerns when you decide on buying a | | | | in that field before engaging them.We work with |
| business and believe me its not an easy road | | | | both the accountants while selling the business and |
| ahead, but with the right advise and the right | | | | are more than happy to answer all questions |
| business for you there are rewards unlimited to | | | | relating to the business in question. We will also |
| help you on the way to building a bank and a | | | | arrange appointments for your accountant to |
| good quality of life. This article will help you all the | | | | speech with the vendor's accountant if |
| way.Important Points when Buying a | | | | required.It's always wise to stay with the |
| BusinessEvery day I receive emails from | | | | accountant who handles the business you are |
| purchasers and business owners needing | | | | purchasing, that's if he is a helpful accountant, if |
| assistance in selling or buying. I use my many | | | | he knows that business well. It's a big plus to |
| years of experience in business sales and running | | | | continue on with him, after all he is the one that |
| a chain of shops to assist them in the right | | | | will advise you when you are ready to sell.Many |
| decision for them. It's a bit like a psychologist | | | | people use more than one accountant today. I |
| really. Its just not a sale for me, it's a | | | | find a good accountant who knows a business |
| dedication.The first thing to remember is you | | | | well is a must to stick with it till the end. I have |
| must get it right the first time because the | | | | dealt will some excellent accountants. Two that |
| business you buy you should be in for at least 4 | | | | come to mind are in my local town and are as |
| to 7 years. I advise my vendors and purchasers | | | | good as any on this planet they are dedicated to |
| to give yourself a 4 year plan. You may love the | | | | their clients and have help me evenly throughout |
| business so much you want to stay longer but | | | | my last two sales (MCW Accounting Tumut, |
| the majority of people are burnt out after 4 | | | | Paisley's Accounting Tumut and Steven Walker & |
| years and are looking for a change, especially if | | | | C.O Tumut) These accountants are totally |
| it's a café or restaurant, and if you feel it's | | | | dedicated to their client's businesses and have |
| wearing you down the business will suffer if you | | | | enhanced the sale of two of the best businesses |
| don't sell then and of course you won't achieve a | | | | in town by showing truthful and accurate |
| good price if the business is run down.Finding a | | | | accounting.Your Business BrokerAs Brokers we |
| Business!I find in my business newspaper | | | | will supply your accountant a profile on the |
| advertising brings me very little sales. My statistics | | | | business so its easy for him to understand. |
| tell me a genuine purchaser will go to the search | | | | Always insist on a profile when looking at a |
| engines to find a broker and scan the listings. We | | | | business. This will give you all the information you |
| do use the papers to get our website name out | | | | need to convince you this is the right business for |
| there and this works to our advantage far more | | | | you. It will include all the statistics of the business |
| than a long expensive add that lasts one day. Our | | | | and a good breakdown of the figures the reasons |
| site is the most valuable tool we have and our | | | | for the sale price, etc.Your broker may ask you |
| journal Best Business Buys gives you months of | | | | to sign a confidentiality agreement. This is |
| good reading to give a purchaser information on | | | | essential to protect the vendor under the |
| how to buy and where. So scan the net under | | | | confidentiality act. Sign it and send it back ASAP. |
| search engines business brokers, if you can not | | | | It does not commit you to buying the business. It |
| find a business on our site there are other | | | | is a mandatory requirement before you look over |
| brokers listed that may be of assistance to you. | | | | the figures. You will find your broker will not send |
| Or better still tell us what you want and we will | | | | you figures if you don't sign.If you have made |
| go find it for you! | | | | your decision to buy the business be sure you are |
| Anywhere in Australia.Problems with Newspaper | | | | proceeding before you commit! Put in an offer |
| AdvertsYou will often see a private add in the | | | | only when you are ready to proceed. Is this is the |
| paper and you may think this is great, we will cut | | | | business for you can you see yourself in for the |
| out the agent and get the business | | | | next few years? Is the family happy with the |
| cheaper.DON'T BE FOOLED!Now I am not saying | | | | move and the change, and most of all is the |
| all private adds are no good, some may work | | | | business viable for you?I sold a produce store in |
| out, but in my experience those people who try | | | | Tumut recently to a buyer from Magnet Island |
| to do it themselves do it because they have | | | | who owned a bed and breakfast (would you |
| either been burnt by an agent not servicing their | | | | believe), and they are just loving it and doing very |
| business, so they think they will do it alone, or the | | | | well, so don't be scared to take the plunge and |
| profit is low in the business and they need a quick | | | | move on. Most of our buyers are relocating and |
| sale, or of course the common one the agents | | | | the stories I have to tell are just amazing!Look |
| fee offends the owner and he thinks he can do it | | | | around be sure the area is where you see |
| better himself. Or he may think the advertising | | | | yourself for the next 5 years. If you are |
| costs to sell his business is less if he dose it | | | | relocating ask your broker to give you the |
| himself.WRONG!When you are dealing with a | | | | statistics on that area, home prices schools etc.As |
| private sale you feel uncomfortable saying what | | | | Brokers and licensed Business agents we pride |
| you really think, and uncomfortable asking certain | | | | ourselves on relocating people and finding them |
| questions so as not to offend the owner. With a | | | | the best business for them, but it's a big plus if |
| broker you can be open and tell us all your | | | | the buyer has some idea of what he feels |
| concerns. We will work them out with the owner | | | | comfortable working in, and after we produce the |
| and rectify them if possible. We as the agents | | | | information to him and his accountant we expect |
| should now the business as well as the owners, | | | | if all is ok he will proceed. If you have doubts tell |
| that's our job. I look at a business when I list it as | | | | your broker. Its unfair to hold up the sale for |
| my own and sell it as if it was my own. A good | | | | another interested party.You will then need to sign |
| broker should be there to help you with that sale | | | | an offer to purchase the business. We have a |
| to the end. Too many owners who try to sell | | | | standard offer to purchase, this will give you the |
| themselves end up in conflict with their | | | | rights to proceed. The time normally for the |
| buyers.And after a few months of failures | | | | option is one week from agreeing to proceed and |
| TRYING to qualify buyers he finds out it's not | | | | this also takes the business off the market. It |
| that easy & worst of it he has given out his | | | | includes a deposit normally of 1% of the purchase |
| figures all over town for all the clients to see, so | | | | price. This deposit is not refundable should you |
| the business you are looking at has been exposed | | | | decide to pull out of the sale, unless it specifies |
| to untold people who may be using that | | | | subject to the reasons why you have pulled |
| information to start down the road.The poor | | | | out.So do your homework first! Be sure your |
| owner ends up coming to us anyway. Remember | | | | accountant is happy with the figures. Your finance |
| if you stay with the broker handling the sale of | | | | is approved and you are confident you are 100% |
| the business he should be the one to assist you all | | | | proceeding before you signed on the dotted |
| the way, and if that business does not work out | | | | line.Your broker will then issue sales advice to the |
| the best for you he most often then not will find | | | | Vendors Solicitors with all the conditions included |
| you another.You Have Found the Business you | | | | that you require, such as the lease terms and |
| Want to Buy!The first thing you will need is | | | | training requirements. After they have looked |
| finance. Are you already cashed up? Or do you | | | | over the advice and done their investigations for |
| need finance. Are you on a redundancy package? | | | | the sale they will prepare the contracts and send |
| These are all the questions your broker should | | | | them to your Solicitor for exchange of contracts. |
| ask before you plunge into a sale.We are | | | | You will need then to pay a 10% deposit on the |
| financiers and finance most of the businesses we | | | | business. This is normally arranged by the finance |
| sell without supplying figures to obtain the loan. | | | | broker, if you have applied for finance, and can be |
| Remember the majority of businesses do not | | | | done in a deposit bond or cheque. This is |
| always show the true figures of the business but | | | | deposited into your agent's trust account until |
| if you look back at the ad backs of that business | | | | settlement.You should have a Solicitor picked out |
| the business may be a very viable business. Most | | | | before you decide to look around so you are |
| accountants will reduce the net profits for a | | | | confident with him when you are ready to |
| business, so the tax implications are not so high | | | | proceed.At Arwon Realty we stick tight with the |
| for that business. If the adjusted profits are good | | | | Solicitors through out the sale keeping in contact |
| the business is saleable and your broker will advise | | | | with them throughout the progress all the way |
| you of this at the time. But never, ever buy a | | | | for a smooth settlement.The contracts should |
| business on hearsay of the takings, if its not in | | | | take no longer than 2 weeks to prepare and |
| BALACK AND WHITE in the accountants | | | | when the exchange of contract takes place this |
| formatted profit and loss statement then its not | | | | means you now are totally committed to |
| considered saleable. Never buy unseen | | | | purchase this business. Any problems should be |
| profits.Business FinanceFor finance to buy the | | | | sorted out between the two solicitors in this |
| business you will need to complete an application. | | | | time.The contracts are exchanged between the |
| This way you will know how much you can | | | | two solicitors and settlement should take place in |
| afford to borrow on the business you are looking | | | | the next 2 - 4 weeks. Business sales are always |
| at. Not all Brokers are financiers! We are and sell | | | | longer than the normal residential sales as the |
| businesses because of it. We use a financier who | | | | solicitors are responsible to see you have a new |
| lends without looking at the figures of the | | | | or exchanged lease for the business. If the |
| business you are about to buy. But with other | | | | property is included in the sale a 149 certificate |
| institutions such as banks or private lenders you | | | | (zoning and compliance certificate) must be sort |
| will need the following.We will arrange finance for | | | | by the council to check out the compliances with |
| you without an up front fee. Most finance brokers | | | | council this take longer than normal.Before |
| charge a fee of between $3,000 &$ 6,000 to get | | | | settlement you have 2 weeks prior and 2 weeks |
| you your finance. We at Arwon Realty do this | | | | after settlement for training. Your vendor must |
| FREE because we are paid on settlement to sell | | | | give you this time to help you understand the |
| the business by our vendors (owners). It is in our | | | | running of the business. We advise the training is |
| best interest to get the finance for our buyers so | | | | done after settlement so both parties are not |
| we in turn can get the business sold, and | | | | showing their nervousness while running the |
| therefore offer a better service to our vendors | | | | business. This could cause the customers to feel a |
| when listing their business. We finance 90% of all | | | | little uneasy.We advise our vendors not to inform |
| business sold!What will I need to supply to my | | | | the staff of the sale until exchange of contract |
| Finance Broker?- Profit and loss statements of | | | | for the same reasons. Your finance must be in |
| the business you are purchasing- Bank | | | | the solicitor's office 48 hours before settlement |
| statements for your own personal accounts.- Pay | | | | for a smooth transaction. Your agent will hold the |
| slips of your current employment or if self | | | | deposit of the business 10% on exchange of |
| employed a profit and loss statement for the | | | | contract and this will be in her trust account until |
| past three years of trading- Mortgage documents | | | | she receives an order on the agent from the |
| for your existing home or properties | | | | solicitors on both sides.Settlement Day!We will be |
| or sales contracts for freehold you hold in your | | | | there with you for the stocktake. Now some |
| and your partner's name.- Personal information, | | | | businesses advertise their business WIWO. That |
| date of birth or passport (photo copy of drivers | | | | means whatever the stock is in the business |
| license)- CRA credit check (you can do this | | | | when you take over is yours and we don't count |
| yourself for a cost of $29.00)- The rates notice | | | | the costs of the stock on settlement. If the add |
| of the homes in your name- Liability and asset | | | | states + stock then we have to stocktake |
| declaration.- The amount you needed to borrow | | | | before settlement and this is done before mostly |
| (You must include the cost of solicitors for advise | | | | the evening before, after close of the till, with |
| and contracts.)Accountants advise: Do it! That | | | | both present and an independent person to help |
| way you know you are covered. I have lost | | | | with the stocktake.So now you are the proud |
| many sales from Accountants advising their | | | | owner of a business that should if your broker |
| clients not to buy and seen many unhappy buyers | | | | has worked for you be the best asset you now |
| loosing out on a sale because an account has | | | | have and we wish you all the very best of luck |
| breezed over the figures and said no don't buy! | | | | and look forward to the day we can asset you in |
| But at least if you do take the plunge and buy | | | | selling for a higher profit!Cathryn Austin is Principal |
| anyway after you have had that advise you are | | | | Licensee of Arwon Realty - Property Business |
| assured you did get advice if something does go | | | | and Finance Brokers, Business, Real-estate & |
| wrong. After all your accountant is paid to look | | | | Stock and Station Agents, and owner of |
| after you and professional accountants will ring us | | | | Australian Businesses for Sale. |
| or the vendor's accountant to get the full story | | | | |