John Denton on Turning A Business In To A Saleable Asset

A business that's 'ready for sale' is well worth keeping!

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You Can’t Change History!

November 4, 2019 by John Denton Leave a Comment

As much as we would like to sometimes, we just cannot change history.

Although, some business owners still try to turn the clock back!

What do I mean by that? Well, every day in business we are creating a history of the business’ performance – reflected in the numbers. Every single thing that happens in the business is there for everyone to see – including potential buyers of the business. And that’s why I keep emphasising to business owners “be aware of the history you are creating. Know your numbers!”

One of my mantras is “Keep your financials clean, up to date and the ‘right’ numbers going up!”

A business, like shares, is much more attractive when there is a history of the numbers going up! The most important numbers are ‘adjusted net profit’ to the owner, turnover, and gross profit. The longer they have been going up the better but at least over the last three years. Steady growth is preferred by most buyers not sudden increases or decreases. Consistency is very important and spread over a good diverse mix of clients. It can take years to get to this state.

One bad number can make a big difference in the value of a business and can put buyers off – big time! Many businesses I get to look at simply do not have a well constructed process for recording and reviewing the numbers. Want to know more? Attend one of my short workshops.

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This is why every business owner who has any ambition at all to sell their business one day, and cash out with a good sale, needs to be planning and preparing their business ready for sale EVERY DAY. Build an asset not just a job for the owner.

A business that is ready for sale will be much easier to manage, run without the owner, be much more successful and will attract buyers. This is the situation you want to be in so that you can have options to sell for the price you want, when you want to. You should be in control of the whole process.

There are many more areas that need to be considered in addition to the numbers. For example how well you structure and record the numbers is also critical. Make it easy for a buyer (and yourself) to see what is happening in the business. Keep your eye on the ball all the time.

In future posts I’ll be covering the other areas but if you want to fast track your learning on the “business ready for sale front” consider attending one of my half day seminars on the topic. To get the details

Register Now

Filed Under: Prepare A Business For Sale, Selling A Business, Business General Tagged With: business broker, business ready for sale, businesses for sale, sell a business, sell a business Perth

It’s Great To Have Standards In Business!

March 28, 2012 by John Denton Leave a Comment

It’s great when you spot a business which “sets high standards” and pays attention to detail. Here is a small and not serious sign of a business which doesn’t pay attention to detail or train staff to maintain standards.This table was set for three people! We all had a choice of style of glass we wanted to drink from! This quite funny example occurred in a very good cafe in our local shopping centre.


It was funny rather than serious but reminded me of how a lack of attention to detail can detract from an otherwise good business. How well do you set standards in your business AND train staff to maintain them?

When it comes to selling a business it makes the decision for the buyer much easier if there are good systems and standards in place.cIt makes the buyer feel confident that the business can continue to be a success under the new owner.

If you would like help with this or any other aspect of getting a business in to a ‘ready for sale’ state – please contact me via the CONTACT US tab at the top of this web site!

All the best, John Denton – helping prepare business ‘ready for sale’ because a business that is ‘ready for sale’ is well worth keeping!

Filed Under: Prepare A Business For Sale, Selling A Business Tagged With: business broker, business ready for sale, businesses for sale

Boom or Gloom

August 2, 2011 by John Denton Leave a Comment

What interesting and challenging times we live in.Australian dollar at over $1.10 US – who would have thought!

Australians are saving at record levels and consumer spending is at record lows. Resources are booming but we are now being told that we have a ‘two speed economy – boom and gloom’. And today’s meeting of the Reserve Bank board is shaping up as the most closely watched in months, with the decision on whether to raise interest rates expected to be a close call.

Then of course, we have Queensland flood tax (call it a levy! Is it really going to Qld flood victims? Who’s auditing it?). What will the carbon tax mean to you and your business next year when it starts on July 1st? Whose story do YOU buy on that one? The reality is that nobody knows what the flow on will be! 

What does all of this change & uncertainty mean to your business? What is it doing to your ongoing profitability? What is it doing to the value of your business? Are you relying on selling your business to fund your retirement? If so, when do you sell?

I am running my half day workshop on “7 Keys To Selling or Buying a Business” on Tuesday 9th August, and will be discussing these issues. For all the details and registration CLICK HERE.

Some things which are showing up in business appraisals are;

Retail is struggling big time

Manufacturing is struggling to compete with China and Asia (What will the additional burden of carbon tax do for them?)

Exporters are struggling with the high dollar

Tourism is suffering from the high dollar

Import and distribution are having a great time. Profits are up due to the high dollar!

SOME WIN AND SOME LOSE! WHERE WOULD YOU PUT YOUR MONEY?

All the best

John Denton

“Helping business owners realise their dreams through buying and selling businesses!”.

 

Filed Under: Selling A Business Tagged With: Small Business, business broker, business ideas, businesses for sale, buy a business, sell a business

New! Businesses For Sale Page

October 14, 2009 by John Denton Leave a Comment

Hi Everyone,

Just a quick post to let you know that I have created a new page on this web site for “Businesses For Sale”. It contains the latest listings of businesses for sale at Performance Business Sales.

You can find the Businesses For Sale page under the SERVICES tab at the top of this page.

Best Regards,

John Denton

Filed Under: Selling A Business, Buying A Business Tagged With: business broker, businesses for sale, buy a business

Read The Damn Documents BEFORE You Sign Them!

September 30, 2009 by John Denton Leave a Comment

Hi All,

As mentioned in the last article I posted, associated with the lack of attention to detail is the reluctance for people to read documents before they sign them. Why don’t they do that?

I think there are a number of reasons! One is the lack of time. Everyone is in a hurry and they may feel pressured to sign rather than spend the time in the meeting ‘reading the detail’. They may feel that taking the time to read everything shows a lack of trust in the other parties and they don’t want to be seen as ‘picky’. Whatever the reason, it can come at a cost.

These are legal and binding documents that are being signed. For example, The Agreement To Purchase comes with pages of “Standard Conditions” which are supplied to both parties ahead of finally signing. They can read them or get a lawyer to read and explain them. In most cases they are written in plain English (ours are at least!). Then there are often several or more “Special Conditions” which get negotiated and agreed between business sellers and business buyers prior to signing.

Even though we spell out the consequences of not meeting many of the terms and conditions – in the euphoria of the business sale (for the seller) and the excitement of becoming a new business owner – people forget.

TIP: Get advice before sitting down to sign ANY document. Know what you are signing and the consequences if conditions aren’t met. Ask for clarification and NEVER ASSUME!

As a seller, you will generally have more than one offer to consider. Make sure you look at any “special conditions” as these may make one offer better than another – in spight of the dollars!

As a buyer, make sure you include any conditions that protect you from post sales blues. Don’t go over the top but cover the major threats to ongoing profitability.

Typically you want to make sure;

  • Plant & equipment is in good working order. Arrange for an inspection by a technician if appropriate
  • Meet with employees, suppliers and major customers to make sure they will continue on
  • Consider a specific Deed Of Restraint on the seller not to compete in the future
  • Organise a stock take to make sure stock is correct and “saleable”
  • Agree how work in progress will be reconciled. This is in standard conditions but I often recommend a specific clause detailing the agree handling of this. It can be a contentious issue if not handled well

A good broker will anticipate most things for you and explain everything – but always get a second opinion and READ WHAT YOU SIGN BEFORE SIGNING!

Want more on this and any topic related to buying and selling a business – come to my next workshop, or sign up for my mentoring group! Go to “Workshops” on this web site and select the one for you.

Regards
John
Helping Business Owners Achieve Their Life’s Goals Through Buying and Selling Businesses

Filed Under: Selling A Business, Buying A Business Tagged With: business appraisal, business broker, businesses for sale, buy a business, sell a business

Roger Gott on “The 7 Key Steps To Developing Your Business Ready For Sale”

July 8, 2009 by John Denton Leave a Comment

“A good session if you are starting in business or have been in it for a while. Until you know what is required to sell a business, you will find it difficult to create a successful one.”
Roger Gott – Cove Health Clubs

Filed Under: Testimonials Tagged With: business appraisal, business ideas, business ready for sale, business sale, businesses for sale

Steve Laing on the half day workshop “The 7 Key Steps To Developing Your Business Ready For Sale”

July 8, 2009 by John Denton Leave a Comment

“It doesn’t matter if you are planning to sell next year, in five years, or in twenty – at some point it is likely that you will be looking to sell it.  Before you do, it is essential that you know what your business is worth on the market.

If you haven’t thought about how you intend to sell your business when you started it up – and lets face it, many business owners don’t – then this course is essential.  You need to prepare for at least three years prior to selling, so thinking about your exit strategy early is extremely worthwhile.  I’d recommend this course to the owner of any business so that they can understand how their business is valued, and how to produce a more saleable, and valuable, asset.”
Steve Laing – Ace Scooters
www.acescooters.com.au

Filed Under: Testimonials Tagged With: business appraisal, business ideas, businesses for sale, sell a business

Turn Your Business Into A Saleable Asset

John Denton on Preparing a Business For Sale

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