JPAbusiness

When business owners come to see us, wanting to sell their business, we often get involved in providing ‘vendor due diligence’.

This basically involves us 'pretending' we're a buyer and has two main components:

1. Understanding what the business is really worth i.e. conducting an independent valuation or market appraisal

2. Understanding how the business appears to a potential purchaser.

That second component is the core part of vendor due diligence and involves looking at the business from a purchaser’s point of view:

Topics: Selling your business, infographic, selling a business, Business valuation, vendor due diligence, business valuer

Planning, professional marketing, timing and finding the right match regarding value and terms are just some of the ingredients that go to making a successful business sale.

The following infographic is a distillation of lessons we've learned over many years of advising business sale clients.

Use these tips to help you make the right decisions when preparing your business for sale.

Topics: Selling your business, Advice, Business Planning, infographic, selling a business

Goodwill is an intangible value associated with a business.

As we have explained in other eBooks and blogs, stock, plant and equipment, and other fixed assets, are tangible items that can be relatively easily valued on a market.

Goodwill is intangible; essentially it is the risk premium around how and what business maintainable earnings (BME) will be delivered into the future if the business is acquired by someone else and run in basically the same way.

Topics: Business Value, Selling your business, Advice, Business transfer, BME, Due diligence, Exiting your business, Business maintainable earnings, James Price, JPAbusiness, goodwill, Parramatta, Orange NSW

If you are a business owner and someone offers to buy your business, their offer price can often look quite good on the surface.

However, it is the basis on which that price is offered that determines whether the price represents true value for the business or not.

An offer price will usually be based on one of two concepts, which I call:

1. Going concern business value (goodwill and related business assets value)
2. Equity value (share value).

Topics: Business Value, Selling your business, Advice, Valuations, Parramatta, Orange NSW, equity value, going concern value

The time it takes to sell a business is heavily influenced by how prepared you and your business are for an open market, or trade, sale.

In this video I'm sharing 3 basic things you should have done before embarking on a sales process:

1. Gathered and prepared some of the key information about your business that a purchaser will want to examine
2. Sought independent advice on the market value of your business
3. Sought professional advice on the potential tax and other implications of selling. 

Topics: Selling your business, Business Planning, Video, Succession planning, business advice, selling a business, James Price, Parramatta, Orange NSW

We are often engaged by business buyers to assist them in undertaking due diligence on target businesses.

In the early stages of that process I often come across vendors who have an accountant, business broker or other advisor who is very coy about sharing what I would call basic financial information on the business.

If you are seeking a purchaser’s genuine offer on your business – whether non-binding or binding – at a minimum, you should be prepared to share the following:

Topics: Selling your business, Advice, selling a business, Business advisor, James Price, Parramatta, Orange NSW, financials

Prospective business buyers value professional, credible, robust information on a business sale opportunity.

Selling a business is about trying to get someone to share the same, or better, perspective on your business that you have.

Get this information provision right and interested parties can successfully understand and evaluate what you know and value about the business, and then put a fair price on it relative to this type of asset in the marketplace.

Present them with poor quality information and it will reflect sourly on your business.

Topics: Selling your business, Advice, Checklist, selling a business, business broker, Parramatta, Orange NSW

As a business owner or manager, there are a number of 'levers' you need to control to successfully manage working capital and drive a successful, cash-generating business.

Topics: Business Value, Selling your business, Cash flow, Working capital, Exiting your business, Checklist

When choosing a broker to help sell your business, there are three key elements to look for:

1. Experience in your industry and in selling businesses of your size and ‘shape’
2. Project management expertise
3. Communication skills.

Topics: Selling your business, Advice, Video, Business advisor, business broker, Parramatta, Orange NSW

Selling a business should not be like exploring an uncharted continent.

When embarking on a business sale you’re not just taking yourself, but you must also bring along your business partners, staff and advisors for the journey. It’s a massive undertaking and not one to be entered into lightly.

Don’t go exploring on a business sale unless you at least know where you want to end up.

This week's infographic is for those just setting out on the business sale journey, and step 1 is about being honest with yourself regarding why you're on this journey to help you determine where you need to go. 

Topics: Selling your business, infographic, selling a business, Business valuation, Business advisor, Business selling, business broker, Parramatta, Orange NSW