Everything you need to know about Buying a Business, Selling your Business and Valuing a Business so you can avoid common pitfalls and save thousands of hard earned dollars in the process
Showing posts with label buying and selling a small business. Show all posts
Showing posts with label buying and selling a small business. Show all posts
Monday, May 23, 2011
Buying or Selling a Small Business Term - "Fidelity Guarantee Insurance"
When Buying a Business ensure you understand Fidelity Guarantee Insurance
What is Fidelity Guarantee Insurance?
Fidelity Guarantee Insurance is insurance against loss of goods, negotiable instruments or other property resulting from the fraudulent or dishonest acts by employee/s.
One of many insurances you must be aware of when buying a business is Fidelity Guarantee Insurance. It's vital to know how many claims have been made in the last 3 years of the business operation, why/when they occurred and by whom.
Wednesday, February 23, 2011
Small Business Australia - The Crawl Back From Disaster
Greetings!
The new year has certainly been 'eventful' to say the least. We've witnesses horrific unimaginable disaster all over our country and now our cousins in NZ are dealing with their own nightmare, which has rocked the region.
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"Six weeks on and it's not just the businesses that went under water who are feeling the pinch.
Enterprises unaffected or now reopened are struggling as they battle perceptions externally that the city is not yet recovered, while internally Brisbane residents cut their discretionary spending.
With 2500 Brisbane businesses losing an average of $800,000 each from the flooding, according to Queensland Chamber of Commerce and Industry estimates, business leaders are calling for residents to open their wallets to help give the city's economy the kick along it needs.
Retail
Chamber of Commerce and Industry Queensland general manager policy Nick Behrens said numerous small businesses in Brisbane suburbs had not reopened weeks after they were damaged and some had no intention to.
"Any business that relies on discretionary expenditure such as retail [and] the service industry - accommodation, cafes, restaurants, hoteliers, bed and breakfasts - they're the ones that are unfortunately doing it the toughest at this point in time," he said.
United Retailers Federation president Scott Driscoll said poor sales had lead to an "extremely high" number of job losses in the retail sector, as well as a reduction in employees' hours.
"All small businesses across Queensland are looking at ways that they can counter costs," he said.
"Unfortunately, one of the ways that they're going to be forced to go ... is to reduce staff hours or reduce staff numbers."
Spending at the higher end of the market appears to be faring worse.
Ted's Camera CBD store assistant manager Lisa Roxborough said sales had been sluggish for months.
"There's not a lot of trade," she said.
"A lot of people are still shopping around but they're more after bargains to save their pennies."
Joanne Mercer Footwear Queen St Mall store assistant manager Monita Anthony said sales were almost non-existent on weekends during the flood clean-up but had started to pick up again.
Tourism
Paul Lewin, CEO of the popular Story Bridge Adventure Climb at Kangaroo Point, said his business was half its traditional January levels.
"I think there is a perception that Brisbane is still closed," Mr Lewin said.
"There are a number of people who phone us up and say 'Are you open yet?'.
Mr Lewin said only about 20 per cent of Story Bridge Adventure Climb customers were international travellers, and that many locals were wary with their spending for either financial or emotional reasons.
"I think to a degree people don't want to be seen as having too much fun in an area that has just been decimated by the floods," he said.
South Bank Parklands CEO Malcolm Snow is facing a similar battle, with up to 70 per cent of the park's visitors from southeast Queensland.
He said it was crucial to pitch any future marketing campaigns at getting local people out enjoying their city again.
Advertising
Marketing budgets are often seen as a way of measuring business confidence.
Mitchell Communications Group managing director Kenny Stewart said the floods had caused some industries to increase advertising, while others were down.
"Retail clients are obviously spending because the [flood victims] are going to be needing furniture and other goods," he said.
"In insurance ... we're seeing advertising up because of the opportunity there.
"Tourism certainly is a massive concern in the market at the moment. Extra money has been made available [for advertising] to [get across] that we are actually open for business.
"The government ... is putting its money where its mouth is to promote the general industry. But individual tourism operators are finding it pretty hard [and are not advertising]."
Mr Stewart said property advertising was the same.
He expected legal services to begin to ramp up their advertising as flood victims sought to chase insurers.
Kevin Moreland, a partner of agency BCM,
said his agency had suffered only a logistical pain during the floods.
"The floods have been certainly a hiccup but I don't necessarily know ... [that] they have had a significant impact on the state of the business," he said.
"It's pretty much business as usual."
Hair, beauty, fashion
A forced three-day closure followed by weeks of slow trade has already cost upmarket Fortitude Valley salon Fabrik two staff and around $30,000 in lost business, according to proprietor Darcy Stratford.
While business was slowing picking up, Mr Stratford said he didn't expect to turn a profit this year.
“People are spending less when they come in – there was a period when I think people felt guilty about spending anything on themselves at all after the floods,” he said. “It went from being a slow Christmas period to staff holidays to floods to cyclones.
“It's a wonder our doors are open at all.”
Several fashion boutiques in some of Brisbane's highest-profile strips have not reopened since forced closures in January, including shops on James Street and Brisbane CBD.
Eloise Monaghan of high-end sensuality boutique Honey Birdette said while her business emerged relatively unscathed, other retailers were struggling in the wake of floods, rate rises and the absence of stimulus spending.
“We lost trade during the floods when we were forced to close all three of our Brisbane stores,” Ms Monaghan said. “But we've come back strong and feel we're well positioned for the rest of the financial year.
“However we've noticed customers in our Sydney boutique still think that Brisbane is underwater so there's an issue of perception still facing small business owners.”
Hospitality
A 15L bottle of Moet was among the $150,000 wine collection lost when Moo Moo restaurant was flooded in January.
While the power remains out, owners Steven and Autumn Adams are ploughing ahead with plans to reopen on March 23.
Others, such as CBD restaurant Barolo, the sunken Drift Café at Milton and restaurants attached to the Stamford Plaza, will remain closed for some time.
But it is good news for some businesses on the swamped Riverside complex and Eagle Street pier, with the Pig and Whistle, Alchemy and Customs House among the venues now back open for business.
However, Groove Train, Jellyfish and Boardwalk Bar and Bistro remain closed.
The flood has led to some innovative thinking, with Jellyfish temporarily sharing space with upmarket steak restaurant Cha Cha Char, at Eagle Street Pier, with a limited menu on offer.
Where to now?
Despite the tough year thus far, Nick Behrens said the future looked brighter for Brisbane.
"The fundamentals of the Queensland economy are still quite sound," Mr Behrens said.
"We have an average 2.3 per cent annual population growth - that's something that's well and truly in our favour. We also have significant infrastructure projects that are going ahead ... [and Queensland] has to rebuild following the floods and cyclone.
"Whilst the Queensland economy is going to take a hit in 2010/11 financial year, the expectation is that for 2011/12 financial year it will well and truly start to pick up."
********************
The new year has certainly been 'eventful' to say the least. We've witnesses horrific unimaginable disaster all over our country and now our cousins in NZ are dealing with their own nightmare, which has rocked the region.
 |
| Brisbane Business Flood Damage (pic supplied by 'Brisbane Day') |
Small Business is certainly feeling the effects in a big way. I was reading some news regarding Queensland's small business owners and how they are getting back on their feet, be it slow. Not only did small business owners have to deal with the mortifying floods not seen for 37 years - but before that occurred and ongoing, they've had the odds stacked against them with high interest rates and a very competitive Australian currency. Many suburban small businesses have been forced to close. Here's what the Brisbane Times writes follow 6 weeks after the floods:
************************
"Six weeks on and it's not just the businesses that went under water who are feeling the pinch.
Enterprises unaffected or now reopened are struggling as they battle perceptions externally that the city is not yet recovered, while internally Brisbane residents cut their discretionary spending.
With 2500 Brisbane businesses losing an average of $800,000 each from the flooding, according to Queensland Chamber of Commerce and Industry estimates, business leaders are calling for residents to open their wallets to help give the city's economy the kick along it needs.
Retail
Chamber of Commerce and Industry Queensland general manager policy Nick Behrens said numerous small businesses in Brisbane suburbs had not reopened weeks after they were damaged and some had no intention to.
"Any business that relies on discretionary expenditure such as retail [and] the service industry - accommodation, cafes, restaurants, hoteliers, bed and breakfasts - they're the ones that are unfortunately doing it the toughest at this point in time," he said.
United Retailers Federation president Scott Driscoll said poor sales had lead to an "extremely high" number of job losses in the retail sector, as well as a reduction in employees' hours.
"All small businesses across Queensland are looking at ways that they can counter costs," he said.
"Unfortunately, one of the ways that they're going to be forced to go ... is to reduce staff hours or reduce staff numbers."
Spending at the higher end of the market appears to be faring worse.
Ted's Camera CBD store assistant manager Lisa Roxborough said sales had been sluggish for months.
"There's not a lot of trade," she said.
"A lot of people are still shopping around but they're more after bargains to save their pennies."
Joanne Mercer Footwear Queen St Mall store assistant manager Monita Anthony said sales were almost non-existent on weekends during the flood clean-up but had started to pick up again.
Tourism
Paul Lewin, CEO of the popular Story Bridge Adventure Climb at Kangaroo Point, said his business was half its traditional January levels.
"I think there is a perception that Brisbane is still closed," Mr Lewin said.
"There are a number of people who phone us up and say 'Are you open yet?'.
Mr Lewin said only about 20 per cent of Story Bridge Adventure Climb customers were international travellers, and that many locals were wary with their spending for either financial or emotional reasons.
"I think to a degree people don't want to be seen as having too much fun in an area that has just been decimated by the floods," he said.
South Bank Parklands CEO Malcolm Snow is facing a similar battle, with up to 70 per cent of the park's visitors from southeast Queensland.
He said it was crucial to pitch any future marketing campaigns at getting local people out enjoying their city again.
Advertising
Marketing budgets are often seen as a way of measuring business confidence.
Mitchell Communications Group managing director Kenny Stewart said the floods had caused some industries to increase advertising, while others were down.
"Retail clients are obviously spending because the [flood victims] are going to be needing furniture and other goods," he said.
"In insurance ... we're seeing advertising up because of the opportunity there.
"Tourism certainly is a massive concern in the market at the moment. Extra money has been made available [for advertising] to [get across] that we are actually open for business.
"The government ... is putting its money where its mouth is to promote the general industry. But individual tourism operators are finding it pretty hard [and are not advertising]."
Mr Stewart said property advertising was the same.
He expected legal services to begin to ramp up their advertising as flood victims sought to chase insurers.
Kevin Moreland, a partner of agency BCM,
said his agency had suffered only a logistical pain during the floods.
"The floods have been certainly a hiccup but I don't necessarily know ... [that] they have had a significant impact on the state of the business," he said.
"It's pretty much business as usual."
Hair, beauty, fashion
A forced three-day closure followed by weeks of slow trade has already cost upmarket Fortitude Valley salon Fabrik two staff and around $30,000 in lost business, according to proprietor Darcy Stratford.
While business was slowing picking up, Mr Stratford said he didn't expect to turn a profit this year.
“People are spending less when they come in – there was a period when I think people felt guilty about spending anything on themselves at all after the floods,” he said. “It went from being a slow Christmas period to staff holidays to floods to cyclones.
“It's a wonder our doors are open at all.”
Several fashion boutiques in some of Brisbane's highest-profile strips have not reopened since forced closures in January, including shops on James Street and Brisbane CBD.
Eloise Monaghan of high-end sensuality boutique Honey Birdette said while her business emerged relatively unscathed, other retailers were struggling in the wake of floods, rate rises and the absence of stimulus spending.
“We lost trade during the floods when we were forced to close all three of our Brisbane stores,” Ms Monaghan said. “But we've come back strong and feel we're well positioned for the rest of the financial year.
“However we've noticed customers in our Sydney boutique still think that Brisbane is underwater so there's an issue of perception still facing small business owners.”
Hospitality
A 15L bottle of Moet was among the $150,000 wine collection lost when Moo Moo restaurant was flooded in January.
While the power remains out, owners Steven and Autumn Adams are ploughing ahead with plans to reopen on March 23.
Others, such as CBD restaurant Barolo, the sunken Drift Café at Milton and restaurants attached to the Stamford Plaza, will remain closed for some time.
But it is good news for some businesses on the swamped Riverside complex and Eagle Street pier, with the Pig and Whistle, Alchemy and Customs House among the venues now back open for business.
However, Groove Train, Jellyfish and Boardwalk Bar and Bistro remain closed.
The flood has led to some innovative thinking, with Jellyfish temporarily sharing space with upmarket steak restaurant Cha Cha Char, at Eagle Street Pier, with a limited menu on offer.
Where to now?
Despite the tough year thus far, Nick Behrens said the future looked brighter for Brisbane.
"The fundamentals of the Queensland economy are still quite sound," Mr Behrens said.
"We have an average 2.3 per cent annual population growth - that's something that's well and truly in our favour. We also have significant infrastructure projects that are going ahead ... [and Queensland] has to rebuild following the floods and cyclone.
"Whilst the Queensland economy is going to take a hit in 2010/11 financial year, the expectation is that for 2011/12 financial year it will well and truly start to pick up."
********************
It is interesting to see how people are working out ways to overcome their business problems after such events, some have closed altogether and cut their losses, some have opened and receiving trickling business but I thought it very interesting and inspiring how others are banning together and sharing the expenses by combining their businesses...brilliant and creative! Obviously there are lots of items, both legal and operational to work through but it's a great way to face such an incredibly devastating event in a positive manner. Small business marketing is also a crucial key to ensuring you get the word out to customers that you're open for business. I will discuss this further in my next blog.
In the meantime, if you live in or close to a devastated area and you managed to get through it without the losses others did, please, please support small business and make an appointment to help our small businesses get out of the mud and survive once again.
Tuesday, November 30, 2010
Small Business Term 'ABN' - What does this represent?
Small Business Australia
Australian Business Number (ABN) - An ABN is a unique 11 digit
identifying number that businesses use when dealing with other businesses.
For example, all types of businesses, including small business, generally
need to put your ABN on your invoices, or other documents relating to
sales that you make. If you don't, other businesses may withhold 46.5%
from any payment to you.
You also need an ABN in certain dealings with the Tax Office and other
areas of Government.
Registering for an ABN is not compulsory, but you will need one to register
for the GST (goods and services tax).
Australian Business Number (ABN) - An ABN is a unique 11 digit
identifying number that businesses use when dealing with other businesses.
For example, all types of businesses, including small business, generally
need to put your ABN on your invoices, or other documents relating to
sales that you make. If you don't, other businesses may withhold 46.5%
from any payment to you.
You also need an ABN in certain dealings with the Tax Office and other
areas of Government.
Registering for an ABN is not compulsory, but you will need one to register
for the GST (goods and services tax).
Tuesday, August 24, 2010
How To Sell Your Small Business Franchise Fast - Tips 5 and 6
Selling A Small Business Franchise
Step 5 - Let your potential buyers be aware of your small business. Make your presence visible so that buyers can find you.
Advertise and promote your small business franchise. Stress the good points of your small business - This will attract the attention of your potential market.
Step 6 - Accommodate questions and be spontaneous with your answers.
You will find it necessary to list down all possible questions that a potential buyer may ask during the sales process.
Being spontaneous will draw their interest to the small business.
Stick to the facts and be honest.
Most importantly...Do not oversell!
Recap:
- Sit down and negotiate
- Be professional
- Don’t appear like you are just interested to close the sale. You have to empathize.
- “Go the extra mile” to be of assistance to your buyer, build a good relationship
- Be sure that they can reach you and be ready to assist
- When all parties are satisfied and happy, your franchise business sale is successful
How To Sell Your Small Business Franchise Fast - Tips 3 and 4
Selling a Small Business Franchise
Step 3 - Prepare your small business franchise with a good sales package to target your potential buyers.
Establish the value of the franchise, set a price, include your assets and financial statements (cash flow), and include other pertinent information needed in the operation of the business.
You can include services like free assistance and training in your sales package.
Step 4 - Understand what the market is looking for. What is the trend in the market today? How big is the demand for your franchise? Are you the only small business franchise business of this type in your geographical area and/or for sale?
Know how the market works - When you know your market, you know where to find your potential buyers.
This is necessary in order to locate where to market your small business franchise otherwise you will have little impact in your target in order to sell your business.
Wednesday, July 28, 2010
Selling a Small Business - What happens if the sale falls through?
Why your small business sale can fall through without warming. Selling a small business yourself and what to do if the sale falls through.
Reducing the risk first and foremost -
- One of the most important things you can do when selling a small business is establish the correct asking price in the first place. 9 out of 10 business owners have no idea what their business is worth
- Provide the business buyer and their advisors with a business valuation which gives details as to how you arrived at the price
- Show them why it's sound - you're taking the guess work out of it for them
It is extremely important to present your business in the correct manner to maximise your small business sale potential.
Wednesday, July 21, 2010
Buying and Selling a Small Business - Why some Business Buyers will Never Buy a Business
The facts about some Business Buyers -
They’re looking for the perfect business. It’s a case of paralyze by analyze. Some business buyers just love looking at businesses - they will do lots of spreadsheets; they analyze every detail…it’s a hobby
They are not so much looking for the perfect business, but looking for the fault or the reason why they wouldn’t buy it.
It’s a common characteristic within particular occupations. The business buyer may begin with the best intentions but lacks the motivation to keep looking and are not prepared to educate him or herself on the process. Particular buyers have totally unrealistic expectations regarding the price of businesses and think they will buy a good business for nothing.
Some business buyers have very little idea what it means to own and operate a small business and it can come as a rude shock when they learn that most business owners work very hard put in long hours. They are motivated to buy a business so they don’t have to work so hard , they have naive ideas.
Whether Small business buyers or sellers, they can be easily influenced -
Others who are opposed to the purchase of a business can influence buyers. Common within family’s that have never experienced small business, they are worried they do not or cannot understand the need to be "your own boss” - transferring their own fears onto the buyer.
Using a helpful resource such as the Bizbuy Kit or Bizsale Kit assists prospective business buyers and business sellers who need to know about buying and selling small business at the correct value.
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