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3 Dec

Is it time to sell a business?

Australians are often described (in an affectionate and possibly jovial way) as a nation of gamblers – and I bet you 2-1 odds you have often thought the same thing!  We often wish our timing had been better when we want to: Sell those shares at the top of the cycle. Buy that property 6

29 Nov

We are updating our statistics on SME trends in exit strategies and performance with a very quick and simple survey. There are only twelve questions and all but one are multiple choice.  It will take less than 5 minutes to answer. All results are kept confidential and aggregated to reveal the latest exit strategy trends for

29 Nov

What do you think about when on holidays? Do you find yourself thinking about your business and what you need to do when you return?  Do you think about the plans you have to grow the business or how you can improve the cash flow? Or do you think about how to exit the business

29 Nov

What does the valuation include or exclude? How do you calculate the value of a business? What information do you need to get the most appropriate answer? Most people think the value of a business is some magic number times the profit of the business – and it in some case that is correct.  But

29 Nov

Christmas season food and drinks? Family and friends? Golf, cricket, football or some other sport? Sunning yourself on the beach? Camping in the bush? For some business owners the holiday season is a valuable time to relax, unwind, de-stress and recharge the batteries. But ironically, as you relax, the mind plays tricks on you –

18 Nov

We see a lot of surveys in the press about business confidence having increased, and I am sure that for every person who is confident about the future there are 5 others who do not feel the same way. Which led me to think – how does confidence in business conditions translate into a valuable

20 Oct

How can a company be worth $1?

In a recent announcement Virgin has acquired the remaining 40% share of Tigerair Australia for the princely sum of  AUS$1 – and many of you would be wondering “why on earth bother?” and “how is 40% worth $1 when almost two years ago it purchases 60% for $35m?”. The answer to the second question emphasises

17 Oct

A recent speech by one of the RBA’s deputies (Guy Debelle) provided a complicated sentence that sums up the current issues facing many business owners – the impact of uncertainty on the value of a business. “The relative stability of macroeconomic outcomes might be delivering a little more stability in the numerator in investors’ calculation

17 Oct

“Buy on the way down and sell on the way up” – this is the generic advice you often hear when asked the question when is the best time to buy shares on the stockmarket.  There is an element of “picking winners” and “timing the market” in this advice.  And some people apply the same

17 Oct

Reliance on Key Customers

As a valuation expert, we often look for the risks and uncertainties in a business to gauge what effect these may have on future cash flows.  One of the key risks is reliance on key customers.  We have seen very extreme differences where one client had 100% of their revenue tied up with one customer

21 Sep

New opportunities for accountants

There has been much hype about new technology for the last decade – and the cloud, big data and mobile technology have featured in much of the hype. With the increased competition for clients and the need to increase productivity to stay profitable, another issue has been simmering away with the accounting profession – how

21 Sep

Why businesses go broke

Since the Global Financial Crisis there has been a steady stream of businesses that have gone into administration.  In most cases a creditor has lost patience and decided to recover as much as they can so they don’t suffer the same fate.  As expected as soon as a business goes into administration, the value of

21 Sep

Retirement Stats for Business Owners

A recent news article about small business owners and retirement savings have some startling statistics for small business owners to ponder.  The statistics came from a St George Bank survey of more than 1,000 business owners.  They found: 55 per cent don’t think they will be able to save enough superannuation for their retirement. One

20 Sep

The Australian Bureau of Statistics released its Innovation in Australian Business report for 2012/2013 last week and it showed some interesting results of the 770,000 businesses surveyed: Around one third had introduced some form of innovation in the FY13 year. 20% had introduced new or significantly improved goods or services and or organisational / managerial processes. 42%

30 Jul

Most insolvencies are SME businesses

A recent news report (Small businesses face biggest insolvency risk: Study) highlighted how sensitive SME’s are to risk: More than 80% of company collapses in FY2013 had less than 20 employees. The study also showed that there were four major reasons for SME collapses: Bad strategic management. Cash flow. Lack of profit. Failure to maintain

10 Apr

The best time to sell your business is when you can demonstrate the certainty of future cash flows, clarity within your business plans and a lack of reliance on key staff or yourself.  This often takes time to develop – you don’t change your business overnight.  Ideally you should allow yourself up to two years

10 Apr

What would you pay to get an increase in your market share? What is an increase in profits worth to your business? How do you make strategic investment decisions? Bendigo and Adelaide Bank(BAB) have given an insight as to how “Big Business” answer these questions with an announcement last year about their growth strategy.  BAB

10 Apr

A Quick Valuation Can Cost You More

How much money would you give away and not expect it back in return?  What would you pay to get the business you really wanted? People go into business for many reasons: Satisfaction of building something substantial. Adding value to customers or clients. Bringing a new idea or invention to market and seeing it grow.

10 Apr

We recently provided a client with a valuation that saved his financial life! This is a bold statement – but our client was prepared to sink in excess of $400,000 into a food franchise business.  On the basis of information we provided, he decided the business was not what he wanted. The client had been

21 Sep

When is a business worthless?

Intuitively we tend to think that a business reporting losses is unlikely to have any value.  There are many small businesses that have experienced losses over the past 2-3 years.  So how have these losses affected the value of your business?  And when is your business “worthless”? A recent public example of this situation was

20 Sep

Be SMART about the value of your business!

In the past a business owner has not had to think too much about the value of their business.  There has been no magical stock exchange that reports “up to the minute” changes in their share price.  It has been up to the owner to discover the value of the business when they go to