To our valued customers, In light of recent announcements, we have closed our physical office doors temporarily to help protect the health and safety of our staff, customers and the broader community. We thank you for your ongoing support and want you to know that we are thinking of you in this difficult time.
While we may be physically shut for the time being, we are still available for our valued customers online. Stay up-to-date with us on social media, or sign up as a subscriber to be the first to know when we list a new business opportunity.
For those of you who are considering selling your business in the future, we are available for consultations during this time to assess your business and to provide you with advice of the best way to prepare the business for sale when the time is right.
We understand that any Buyer will be concerned how this pandemic has affected your business and by implication, the value, but we have various strategies which we may be able to apply to your business financials which will result in a “normalisation” of the results and thus hopefully still provide a good outcome for you in a sale.
Feel free to call us or email us for an initial chat and to utilise this down time productively to optimally prepare your business for sale. In the time being, we hope you stay safe and wish you the best during this time of uncertainty. The Core team. CONTACT: [email protected] or call us on 94132977
A non-disclosure agreement otherwise known as a
confidentiality disclosure agreement or NDA/CDA, is a legally binding document
that safeguards business owners during the sale of their business. When selling
a business, part of a potential buyer’s due diligence is to investigate your
business from a to z; examining profitability, financial statements, staff
rosters and often sensitive information that you don’t want made available to
the public. Importantly, you do not want that information to be used in future
competition against the business. So,
what’s stopping a prospective buyer from reviewing your information and telling
their friends? A non-disclosure agreement.
What is a non-disclosure agreement?
An NDA prohibits the signed parties (interested
buyers) from disclosing any information about your business to external parties
and which is not readily available to the public. It isn’t necessarily
mandatory, especially for businesses that are very transparent and not
concerned about information becoming available to the public (e.g. some public
companies). However, if the buyer is potentially viewing proprietary or
confidential information about your business, it is highly advisable that a
non-disclosure agreement be signed.
When is an NDA used?
NDA’s can be used in various industries, where
people want to keep confidential information solely between the parties
involved. Whether that’s in business transactions or during acquisition or
dismissal of employees, NDA’s can be incredibly beneficial to the person of
whom the confidential information belongs to at that point in time, as it
safeguards that information from becoming common knowledge. Think of NDA’s as a
more legal version of a promise. The person signing the NDA is ultimately
promising to keep their lips sealed about the topic in question, which in this
case – is your business information.
What do NDA’s typically include?
Non-disclosure agreements typically include legal
clauses that state that information made available between the parties in
question (business owner and potential buyer) must remain confidential.
Generally, any information obtained by the buyer about the business from any
other source is not covered within the NDA, as it was not part of the
confidential knowledge transaction outlined within the NDA.
Where do I obtain an NDA?
Understanding NDA’s are key to using them
efficiently and correctly. At Core Business Brokers, we have years of
experience dealing with non-disclosure agreements between business sellers and
prospective buyers. If you are looking to sell your business, chat to us today.
We will go through the process with you and explain all key areas of interest,
allowing you to feel confident in your business sale endeavours.
Contact Core Business Brokers today, on (02) 9413
2977, or email Roy on [email protected]. We’re always to
schedule an appointment and to chat through your options.
Thinking of buying a business? Or maybe starting
one from scratch? Either way, understanding the industry is key to growth,
profitability and success. So we sat down and dived into the latest IBIS World
report on industry growth in 2019 and 2020. The results? Very interesting.
When it comes to business sectors, there’s a
definite trend in which ones are growing in 2020. There is no hiding the fact
that Australians are leaning toward a more sustainable way of living. Younger
generations are caring more about our planet than the baby boomers, and
business is not exempt from their standards for a sustainable future.
According to the IBIS World ‘Fastest Growing Industries in
Australia by Revenue Growth (%) in2020‘, the top growing
business sectors are those that aligned with these sustainable living
practices. However, not all sectors were following this trend. Other clear
factors were convenience, such as rideshares and online food ordering. Sitting
at the top were sectors such as:
Exchanges in Australia
Funding in Australia
Food Ordering and Delivery Platforms in Australia
Sharing Providers in Australia
Services in Australia
Crop Farming in Australia
Electricity Generation in Australia
Security Consulting in Australia
Advertising Agencies in Australia
Exploration in Australia
Out of the above list, at least three of these
sectors are sustainable trends, while another three prove convenient for the
consumer. It makes you think, as a potential business buyer or a current
business owner… How will my business appeal to the current market? Do they need
me? Do they want me? If so, for how long?
It is important to note that trends in sector
growth and profitability are variable, so this list – although current at
present, will change in the future. The vital takeaway is to do your research.
Understand what consumers in your industry are expecting and what they are
yearning for. Can your business deliver this? If you can service a growing market,
there is no limit to your business growth.
At Core Business Brokers, we are more than happy to
discuss industry trends and past sales data that we have experienced firsthand.
Contact Core Business Brokers today, on (02) 9413 2977, or email Roy on [email protected].
We’re always to schedule an appointment and to chat through your options.
Times are changing. We are well into an era that has
a strong online presence, which means that businesses that previously survived
quite well with nothing but a brick and mortar store, face the reality that
they need to adapt and grow, or simply be left behind.
For those business owners that have put off the
creation of a website, social media and the thought of online advertising, the
process can seem daunting. Therefore, it may be wise to consult a professional
marketer to gain insight into the current trends and the components they
believe you should implement to stay relevant in the ever-evolving world of
So, what are the basic changes I need
There is no right answer that suits every business.
Each business is unique and staying relevant in your industry is going to be a
different process to your neighbour. However, let’s take a look at some
important changes that may need to be undertaken to stay current in 2020:
your website outdated? Do all the links function properly? Does it take a while
to load? A crisp, modern website that reflects your brand, is easy to navigate
as a viewer and has concise information about your product and/or service is an
asset to your business. Gone are the days of the majority of your customers
using the yellow pages to find you. If your website isn’t up to scratch, your
customers will most likely find a competitor that looks better from the
Media: Statistics show that younger demographics are
searching for businesses using social media more than they search via Google.
That surprised you, didn’t it? Not on Facebook or Instagram? You should be!
These free platforms are just another advertising tool that allow you to
connect with your target market. It’s not enough simply to ‘have them’, you
also must use them. Post relevant facts about your service or product, the
industry, FAQ’s, fun facts. The list is endless. Use these platforms to build
professional relationships and advertise to your target market.
known as ‘Search engine optimisation’, SEO works on keywords and allows your
business to be shown more prominently on search engines, such as Google. Using
SEO correctly means more people visiting your website, finding out about your
business and hopefully converting into customers.
Advertising: With the increase in popularity of
social media platforms such as LinkedIn, Facebook and Instagram, comes the
ability to advertise via these platforms to reach your customers. Gone are the
days where you’d put an ad in the paper and hope that people see it. Nowadays,
the internet collects information about your behaviour online and then social
media platforms and search engines (such as Facebook and Google) use this
information to display ads that appeal directly to the viewer. Long story
short, online advertising is targeted and much more precise than it used to be
– meaning it can be a valuable tool for modern businesses.
customer-first approach: As time goes by, more and more
competition arises in the market. More products and services are available in
more areas, making it harder for businesses to secure customers. People value a
deal, but they also value the experience. Emphasise your customers’ needs and
desires, putting them first and making them feel important and special.
Creating customers that return to your business time and time again is
your competitors: Stay up to date with what your
competitors are doing in the industry. Are they a part of events? Where are
they advertising? Are they hosting a customer function? Producing a
publication? Whatever they are doing, keep your finger on the pulse and find a
way to go one step further (if what they’re doing is successful, of course!)
Before you make any changes to your business model
and plans, it’s always wise to do a risk analysis – building a moat around your
business so that a potential buyer does not see too many risks associated with
your business when it comes time to sell.
At Core Business Brokers, we advise that you chat to a Business Consultant to grow your business into its most productive, profitable state. Make sure to conduct due diligence before making changes and always view your business from the eyes of a potential buyer. If you’d like to chat through ways to stay up to date in your industry, in preparation for a potential sale. Contact Core Business Brokers, on (02) 9413 2977, or email Roy on [email protected]. We’re always happy to lend a hand, offer advice and assist with your business needs.
established reputation of a business regarded as a quantifiable asset and
calculated as part of its value when it is sold.”
What does that mean when we talk about business? A business’ goodwill can be viewed somewhat as their reputation. Goodwill isn’t a tangible asset. Although it is an intangible asset, it can be incredibly valuable. A business with a higher amount of goodwill will reflect this in the sale price, as goodwill generally takes time to build and can strongly affect profitability.
easiest way to explain how goodwill works is through an example. Here are three
different businesses and how each of them has a different goodwill value – and
more importantly, why that is the case:
bottle shop: You may have a favourite bottle shop. But think of why you
frequent this one over others. The price and the staff come into play, but more
often than not – it’s the location that is convenient. It’s nearby for a quick
run to get another bottle of wine if needed, therefore their goodwill lies in
their location. If the owner sells their bottle shop and a new owner begins,
would you change shops? Probably not. That is why this is referred to as
hair salon: A hairdressing salon may also fall somewhat into the locational
goodwill category, but unlike a bottle shop – there is one big difference… It’s
a service business. In particular, a personal service business. The hair cut
and colour you receive from your hairdresser may not be the same quality you
receive elsewhere, therefore this is a business you may follow elsewhere if the
owner decides to sell. This is referred to as ‘personal goodwill’
TV network: Whether you watch the news on one station or another, the
likelihood of you changing each week is slim. They essentially report on the
same news, however, you’ve always watched Channel 9, so why change now? This is
defined as ‘brand goodwill’
you’re buying a business, it is important to assess the type of goodwill
attached to the business in question and ask yourself these questions:
this goodwill associated with the business or the owner?
associated with the owner, how can it be transferred to me?
is one of many variables that is assessed during the early stages of a business
purchase. Here at Core Business Brokers, we are happy to break down the
components that form the business sale price and explain why the goodwill is
valued the way it is.
If you are looking to sell your business and wonder how valuable your goodwill component is, contact us today on (02) 9413 2977, or by email at [email protected]. Our experienced team of Business Brokers have years of experience both appraising and valuing businesses and would be more than happy to explain any questions you may have regarding goodwill.
According to business sales data (BIZSTATSTM)
approximately 60% of a business sale price is allocated to intangible assets.
This figure varies greatly from business to business, however, the value of
intangible assets in a modern age is increasing. Let us explain.
What are ‘intangible assets’?
Intangible assets are assets that don’t physically
exist. I.e. They cannot be seen or touched but still form part of the business.
They cannot be transferred physically from one party to another but can be
transferred via legal documentation. Examples of intangible assets include, but
are not limited to:
Copyrights, trademarks & patents
Symbols & logos
Domain names and websites
Tangible assets, on the other hand, are the exact
opposite. Physical in nature, these include assets such as plant and equipment,
land, vehicles and other inventory.
Why are intangible assets important?
The importance of intangible assets increases
depending on the type of business and what intangible assets they own but
typically are valued according to the profitability of the company. As we near
2020, many businesses have a large online presence or operate solely on
e-commerce. Large corporations such as Facebook may not have many tangible
assets, but their intangible assets are plentiful. These increase the value of
the business, and if it were to be sold would directly affect the sale price.
How do you put a price on intangible
With intangible assets forming such a large part of
the overall business value, it is important to assess all assets owned by the
business you’re looking to buy and check the following:
do these intangible/tangible assets relate to the operation and overall
profitability of the business?
these assets be secured with contracts or registration and be legally
are these assets transferred to me, the buyer if the business sale goes ahead? As
legal transfer of ownership is critical.
The assessment of a business’ assets,
whether tangible or intangible forms part of your due diligence when
considering a business purchase. For assistance navigating your way through the
business sale process, contact Core Business Brokers today on (02) 9413 2977.
There are many areas to consider when embarking on your journey. Let us guide
There are many reasons to purchase a business and depending on who you ask, those reasons rank differently because your motivation behind buying a business ultimately comes down to what you want in life. Is it profits? Freedom? Alongside the potential risk and the hard work involved in owning your own business, owning your own business also comes with its fair share of positives when considering the pros and cons list. Let us highlight some of the top reasons why buying a business could be a great option for you.
Profits: Unlike previous jobs where you’ve been an employee, owning your own business comes with the opportunity for uncapped earning potential. If your business continues to grow and become profitable, you will reap the rewards at the end of the day. Of course, there is always the risk/reward issue to consider as well.
Employment: Owning your own business removes any possibility for you to be made redundant or your contract be terminated by another party. If your business remains profitable, your job will be safe. For this reason, you feel more in control over your career than ever before.
Independence: Your business means your decisions. If you’d like to steer your business in a certain direction, you now have the power to do this. There is nothing more satisfying than making strategic plans for your business and watching them come to fruition and prove successful. Your business is your time to make your mark and captain the ship!
Lifestyle: Being a business owner can be a very busy job. More often than not, the owner of the business is the person who works the most hours, as they have the most at stake. However, once the business proves successful, you may be able to take a step backwards and begin to live the lifestyle you’ve always dreamt of. Whether it’s weekends off, or an extended holiday once a year, there’s no reason why you can’t work this into future plans. The proviso here is that you have learnt along the way to employ competent staff and thus become a competent “manager” who is able to delegate tasks to staff and employ controls to maintain standards.
Opportunity: Last but not least, owning your own business comes with countless opportunities. The opportunity to make a positive change in your community, be a voice to the masses, accomplish financial growth, create an empire, the ability to franchise in the future, the options are limitless. A word of caution, always seek independent advise from a competent professional advisor who will have an unemotional appraisal of the business you are looking to purchase.
All the above points are important considerations when looking to buy a business. However, no two businesses are the same, just as no two buyers are the same. It is important to consider both sides of the coin when venturing down the business ownership path.
If you’d like to discuss the process with an expert, contact Core Business Brokers today, on (02) 9413 2977, or email Roy on [email protected]. We know business sales like the back of our hand and will be more than happy to chat with you about our experience and your future.
A successful business could change hands many times
during its life, whether to family members or unrelated parties who are
passionate about continuing what you started. When it comes time to sell your
business, it is important to present it to potential buyers in the best
possible light. This doesn’t mean just looking good on the outside, your
business should be profitable and functioning well to appeal to prospective
buyers. Importantly, has the business “divorced” itself from you (the owner) so
that the Goodwill vests in the business itself and is not seen to be part of
We’ve discussed the importance of exit planning here, but to recap – exit planning is essential for the survival of your business, for the sole fact that not all sales are gradual processes. Some occur due to sudden events, such as ill-health or family issues. Having an exit strategy in place ensures a smoother transition when it comes time to sell your business.
A great way to prepare your business for sale is to
view your business through the eyes of a prospective buyer. Would you want to
buy your business if you viewed it with fresh eyes? If the answer isn’t a
concrete ‘YES’ then you have work to do. Here are some ways you can add value
to your business when preparing to sell:
Make sure all financials are up to date
Show proof of profitability (even with
Ensure all necessary contracts are in
place, up to date and transferrable
Tidy up processes, manuals and other
key operational documents
Make sure your lease is secure
Sell off plant and equipment as well as
other assets that no longer contribute to the business so that they do not
represent any weaknesses and become a distraction in the sale process. The same
applies with any redundant or old stock.
Do a general ‘tidy’ of the premises.
Although we don’t like to judge a book by its cover, the tattered book stays on
Organisational structure – are there
key staff in place and how critical are your functions to the business?
doing the above, you are adding value to your business – which ultimately looks
attractive to potential buyers. For more information
on what you can do to add value to your business, contact Core Business Brokers
today, on (02) 9413 2977, or email Roy on [email protected].
Our experience in business sales is second-to-none, which allows us to provide
honest advice to our clients.
When you approach the end of your business ownership journey and are
preparing to sell, you need to determine the market price of your business. A
business’ market price is dependent on current market conditions, it’s history
of success & profitability, future profit forecasts, goodwill, stock,
assets and much more. Determining the ‘value’ of your business during this
process leads to many business owners thinking they require a ‘valuation’ –
however, this may not be the case. Let us explain the difference between a
business valuation and a business appraisal, so you can determine which suits
your situation best and what to ask for when consulting with your business
What is a business appraisal?
A business appraisal is a service that all business
brokers should provide. It involves their calculated appraisal of your
business, taking into account several important factors and using their wealth
of industry experience to lead the way. Due to this being an educated opinion,
you may find that you receive different values with different brokers. Keep in
mind, that a good broker will be honest and set realistic expectations – even
if this means disappointing you in the short term. After all, there is no point
in raising expectations and listing your business for double the realistic
market price and then have it remaining on the market for years without any
serious interest. That being said, you want to make sure you engage a
trustworthy, experienced business broker who will take into account all
necessary information to appraise your business properly and provide you with
an honest and realistic value range whilst being able to explain the rationale
in arriving at this conclusion.
are concerned with your appraised market price, discuss this result with your
broker. At Core Business Brokers, we are happy to sit down and explain how
we’ve come to the market price presented, as we believe honesty and
transparency throughout the business sale process are key. In addition, having
one of the Principals as a qualified accountant means that they can engage
professionally with your accountant in making the assessment.
What is a
business valuation is performed by an accredited business valuer. Unlike an
appraisal, not all business brokers can conduct a valuation. There are a couple
of big differences between a business valuation and an appraisal. Firstly, most
business brokers do not charge for a business appraisal – it is performed in
the hope that the seller will list their business with them if they decide to
go to market. A valuation, however, costs between $3,000 and $4,000 on average.
Why do Valuers charge for this service? Because a valuation is much more
in-depth than an appraisal. Commonly used for court proceedings, taxation or
insurance requirements, banks and the ATO require a high level of detail and
accuracy when a business broker conducts a valuation. A valuation is a handy
tool for potential buyers, as it is a more accurate depiction of the business.
If you are still unsure as to which service you require in your unique
situation, contact Core Business Brokers today on (02) 9413 2977, or email Roy
on [email protected]. One of our
professional and knowledgeable team will be more than happy to discuss your
options and answer any questions you may have.
your own business takes years of sacrifice, hard work and often delayed
earnings. Selling your business for the right price, is a chance to reap the substantial
rewards for your years of hard work and associated risks.
things to think about when starting your business
Structure – Getting the business
structure right could make a huge difference to capital gains tax when it comes
time to sell. If it is a small business as defined by the Australian Tax Office
(generally one with assets valued at less than $6 million or turnover of less
than $2 million), any capital gain on the sale may be free of tax and used as a
retirement nest egg. In some instances, structures require changing prior to
sale in order to achieve the desired outcome. This is a common path for
businesses run through a family or discretionary trust, as this could prove
problematic for a buyer and may need to be restructured prior to sale.
Structure – It
is important to create good business habits from the word go. Keeping your
financials organised, creating a clear organisational structure and ongoing
maintenance of business policy will ensure that your business is an efficiently
run, attractive option for prospective buyers when the time comes to sell. It
is also important to work on separating the goodwill of the business from the
owner himself. This allows for a more seamless transition when the business is
Results – Is your business performing
well? Is there anything you can do to increase sales during the last few
financial years of operation prior to sale? Prospective buyers will pay a
higher price for a business that is performing well and showing signs of growth
— therefore, positive trends with future growth potential is a key element in
securing a higher multiple for the business.
Forecasting – As a business owner, put on a
buyer’s hat to confirm all aspects have been thought through and addressed
prior to sale. For instance, do you own all intellectual property and have all
licenses been renewed? Is your business registration current? What are the
terms of your lease to ensure continuity? Common speed bumps during the due
diligence process are due to oversights by the seller. Imagine you are buying your
business and ask yourself what you would look for. In particular, ask yourself
what risks could be associated with the business and then work towards
eliminating or reducing these risks before selling. By doing this, there will
be fewer surprises during the sale process, as all speed bumps will have been
discovered and addressed in advance.
strategy – It
may seem pointless to create an exit strategy when creating your business, but
it’s this next level of planning that allow for the smoothest transition
possible when it comes time to sell your business. Instead of tackling this
task when you’ve decided you’re going to sell, create it at the beginning and
modify it annually to keep it relevant and up to date.
business goals will no doubt change drastically from day one through to the
final day of ownership. You may have poured all your financial resources into
your business, which puts pressure on achieving the maximum sale price in order
to reap the rewards of your hard labour. However, it is important to note that
the sale price is always relative to the current market, trends, economy and
the performance of the business. All these variables come together to determine
the final sale price of your business, but the ability to demonstrate good
profits throughout different cycles in the economy is paramount.
order to plan for the best possible outcome, it is important to ensure you are
doing all that you can from the word GO.
For assistance with your sale preparation, contact Core Business Brokers today, on (02) 9413 2977, or email Roy on [email protected]. One of our professional and knowledgeable team will be more than happy to discuss your options and answer any questions you may have.
Core Business Brokers Suite1A, Level 2, 802 Pacific Highway, Gordon 2072.