8 tips for conducting due diligence [infographic]

Posted by James Price | JPAbusiness on 09-Oct-2019 02:00:00

Due diligence is ‘the process of acquiring objective and reliable information on a … company as required, especially before a commercial acquisition’ [Macquarie Dictionary].

The over-riding purpose of due diligence is to ensure there are no nasty surprises after you buy a business.

We’ve created the following infographic to share some of our top tips for people embarking on the due diligence process.

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Topics: Buying a business, Due diligence, infographic, business advice, James Price, Parramatta, Orange NSW

What determines your Business Maintainable Earnings? [infographic]

Posted by James Price | JPAbusiness on 02-Oct-2019 02:00:00

When determining what a small to mid-sized business is worth, Business Maintainable Earnings (BME) is one of the key concepts the market will consider.

BME reflects the ability of a business to generate earnings into the future.

Remember, as a buyer you don’t want to pay for opportunity you will create in the future; unless there is a strategic element to the purchase, ideally you only want to pay for what has been built up by the vendor.

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Topics: Business Value, Buying a business, infographic, business advice, Business valuation, Business advisor, Business maintainable earnings, James Price, Parramatta, Orange NSW

Do you have what it takes to run a business? [infographic]

Posted by James Price | JPAbusiness on 18-Sep-2019 02:00:00

Before you spend months trawling through business advertising sites, trying to decide which business would best suit you, first consider whether you would suit business.

In this infographic we’ve summarised 10 attributes we tend to see in successful business people.

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Topics: Buying a business, infographic, Starting a business, business advice, business management, business ownership, Parramatta, Orange NSW

How do earnouts and contingency payments work in practice? [video]

Posted by James Price | JPAbusiness on 28-Aug-2019 02:00:00

If you are considering selling a business at the larger end of the SME market, with a longevity of orders and forward earnings, it’s important to consider the concept of earnouts and contingency payments, because it will come up from interested parties.

It’s also important to recognise that earnouts as part of the purchase price have capital gains tax implications, so expert advice is essential.

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Topics: Buying a business, selling a business, Business advisor, seller earnouts, Parramatta, Orange NSW, contingency payment

How long does it take to buy a business? (Video)

Posted by James Price | JPAbusiness on 14-Aug-2019 02:00:00

We have helped some clients find the right business within six months while, for other clients, it has taken over three years.

The key phrase is ‘the right business’; I’m sure we could speed up the process if our aim was just to help our clients buy ‘a’ business, but that’s not our job.

In this video I explain why it's important not to rush into buying a business, and share four tips for managing risk during the business buying process.

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Topics: Buying a business, Video, business advice, Business valuation, Business advisor, vendor due diligence, Parramatta, Orange NSW

How NOT to manage a business ownership transfer

Posted by James Price | JPAbusiness on 10-Jul-2019 02:00:00

Value can be destroyed overnight if a business sale transfer goes wrong.

A few years back we published an eBook and checklist designed to help people manage this transfer process, after an experience I had while conducting due diligence for a client.

My client was in the process of purchasing a building products business in Queensland, which sold to both the trade market and retail customers.

Contracts had been exchanged and a deposit paid by my client, but the sale was subject to the outcome of my due diligence.

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Topics: Buying a business, Free download, Business transfer, Checklist, business advice, selling a business, JPAbusiness, Parramatta, Orange NSW

Follow our 10-step business buying process [infographic]

Posted by James Price | JPAbusiness on 03-Jul-2019 02:00:00

 

Step 1: Imagine the process of assessing different businesses for sale as a funnel

The top of the funnel is wide and has a screen which sifts out businesses which don’t meet your requirements.

These requirements may relate to:

  • Geography
  • Size and turnover
  • Earnings
  • Price
  • Product or service
  • Customer base, etc.

Once the various sale opportunities have been ‘sifted’ you are left with the select few businesses which meet your requirements. 

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Topics: Buying a business, Free download, infographic, business advice, Business advisor, James Price, business buying funnel, Parramatta, Orange NSW

Do I need a broker or advisor to buy a business?

Posted by James Price | JPAbusiness on 03-Jul-2019 02:00:00

I strongly advise anyone looking to make a substantial investment in a business to consider independent external advice, whether that comes from a business broker, business advisor or accountant, or another specialist.

That advice might be in the form of:

  • providing a sounding board as you determine exactly what your own aims are in buying a business
  • objective advice on whether the business or businesses you’re considering actually meet those objectives
  • providing an independent view of the value of the business you’re looking to buy
  • assisting you in the purchase negotiation process
  • conducting the due diligence process.

However, this is where my answer gets a little tricky, because not all brokers have the same level of experience, and some offer a form of service I don’t endorse.

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Topics: Buying a business, business advice, Business advisor, business broker, JPAbusiness, business basics, Parramatta, Orange NSW

How to ensure you pay a fair price when buying a business

Posted by James Price | JPAbusiness on 19-Jun-2019 02:00:00

In our experience, the risks associated with business purchases fall into three categories:

  1. People
  2. Customers, suppliers and market dynamics
  3. The value exchange.

In this blog we’re focusing on the third risk category, the value exchange, and how you can manage that risk.

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Topics: Business Value, Buying a business, business advice, risk management, Parramatta, Orange NSW

 
Disclaimer: The information contained in this blog is general in nature and should not be taken as personal, professional advice. Readers should make their own inquiries and obtain independent, professional advice before making any decisions, taking any action or relying on any information in this blog. 
 
 

 

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