Preparing to sell your business is about more than just putting it on the market and waiting for a purchaser. To make the process as smooth as possible, it’s important to make sure your business is in order and sale ready. There are a few key things you should consider to help you attract those purchasers and ensure a fast and successful sale.
The amount of time it takes for your business to reach the point of getting on the market is dependent on how sale-ready it is. This means that in order for your business to reach the market, you need to have all your affairs in order and have good structural processes and systems in place. To help do this, it is paramount to seek advice from a knowledgeable team of professionals to ensure you are meeting all the requirements for a smooth sale.
One of the key aspects of selling your business is managing expectations and setting these out from the start. This includes timetables and the overall plan for what the purchaser is going to need or do when it comes time to close the sale, and what the outcome of this will be. The seller should also make sure to tie up any loose ends such as assets they wish to retain (motor vehicles, etc.). They will want to do the same for Director and Shareholder loans and understand how these will be dealt with following the sale, whether these be fully repaid or in the form of a dividend. You can see why having a clear plan is important.
When a business is selling shares, it is particularly important to eliminate assumptions and have a plan set in place so that the purchaser knows how much capital they will need, if they are going to access a dividend prior to the transaction occurring, etc. If expectations are not managed effectively, we often see deals falling over at the back end because the offer which was made was based on assumptions that were completely different to what was in the vendor’s mind.
Similarly, when you’re selling a small business or shares in a business, structural considerations are very important. A small business is defined as a business with a turnover of less than $2 million, or where the group assets sit below $6 million. These structural considerations can affect your eligibility to gain access to the Small Business Capital Gains Tax (CGT) Concessions. Any share transfers or movements that you’re doing just before a transaction occurs, or having dividend access shares where you can access profits before and during the trade of that business, will create some complications in terms of accessing those concessions.
These concepts coupled with the legalities of the process, such as having key contracts in place with employees, customers, suppliers, and leasing spaces are vital, allowing you to have a clear plan for all aspects and parties involved.
A final piece of advice, be sure that you are being transparent with the purchasers in order to build a trusting relationship and in turn, a seamless and hassle-free business sale.
This blog is based predominantly on the information given in our Law in Life Series, Episode Five: Preparing Your Business for Sale. Watch the full panel discussion here.
Related blog: The post pandemic business impact
When it comes to Investing in Real Estate, homework pays off. A guide to researching your investment property
Embarking on a real estate investment journey demands more than just financial preparedness on its own. There are a range of intricacies in researching your potential investment property that should be explored prior to making your investment property purchase. This guide explores three fundamental aspects of research that can significantly influence your journey towards successful real estate ventures: understanding the property, investigating the area, and the importance of meticulous due diligence.
Understanding the Property
“Know what you’re buying, understand the property that you’re purchasing” – Karlene Glanville – Karlene’s Conveyancing
The first thing to do when researching a property is to really understand it. Look beyond just what you can see on the outside. This means figuring out all the details in the contract, finding out about any special rules or limits on the property (like who can use it or what you can build), and understanding what you’ll be responsible for, especially if there are already people renting the place. Knowing all these things makes your position stronger and lowers the chance of getting surprised with unexpected issues after you buy it.
Researching the Area
“If you’re doing research on areas look for long term capital growth” – Paul Hills – Real Estate Agent – The Agency, Central Coast
While its important to research the property itself, it’s also really important to look closely at the area where your investment property is, including the neighborhood, what’s nearby, and how much the area is growing. Look into how property values are increasing, check predictions for the future, and understand how renting works in that area. By getting deeply involved in understanding the location, you’re not only making smart choices but also setting yourself up for success in places that are growing a lot and in high demand.
Due Diligence and Checkpoints
“It’s no use going to an auction unless you know what you get, how much you can bid and those sort of things” – Darren Hooper- General Manager – Unity Bank Central Coast
Adopting a strategic step-by-step approach to finding the best investment property means making sure everything is in order. Whether you use a list given by your advisor or make your own, being careful to get your money approved beforehand, thinking about working with buyer’s agents, and understanding the costs involved. All of this is super important, especially in situations like auctions where being well-prepared can be the key to making a successful investment instead of missing out.
In the realm of real estate investment, knowledge truly is power. With tips from Karlene Glanville, Paul Hills, and Darren Hooper, you’ll have what you need to figure out how to buy the best property for your investment portfolio. Start by learning about the property, then check out the area, and finally, be exceptionally careful with your research. As you start your investment journey, just remember: doing your homework pays off, and making smart choices now,, means a successful tomorrow in the real estate world.
This blog is based on the panel discussion from The Property Show Presented by The Leasing Network. In this discussion, a group of experts provided their perspectives on the theme of “A Beginners Guide To Investing In Real Estate” Watch the full panel discussion here!
See related blog here: Buying Property in 2022, Key Tips
As a business owner, it is important to be a financially proactive business post pandemic, especially from a financial and legal standpoint. Sometimes we find ourselves in a situation that is not looking too good. Do you know what red flags to look out for? We dive into what business owners should be keeping an eye out for and what they should be doing to ensure they are staying proactive when it comes to their business.
Where to start
Being financially proactive starts with having a good understanding of where you are at across all areas of your business and how covered you are for anything that may arise. For example, if your business was heading into financial distress, there are things that you should look at doing from a legal point of view to better protect your position. So, what types of red flags should you be watching out for in this instance? Let’s break it down.
If you’ve got debts that are accruing, they’re not getting paid; one of the things that you can look at is security. Always consider what other options you have available to you in case the business can’t pay for them. There are many things that you can do if this were to happen.
What steps to take
Firstly, there are personal guarantees. This involves registering your interest on the personal property securities register, possibly lodging a caveat. If it’s appropriate in the circumstances, get cash into your trust account before you undertake the work. There are ways that you can secure yourself to make sure that if the company goes into liquidation, you’ve got other options available to you.
Another thing to consider is to make sure that you have a good credit policy. To do so, you have got to be firm with your customers and clients, as a lot of businesses allow things to get too far out of control. Especially when we’re looking at the margin of say one hundred thousand dollars, bad debt could spell insolvency for most small businesses. Businesses should be comfortable talking to customers and clients, when they can recognise they’re starting to lag, perhaps in paying debts or phone calls aren’t getting returned, etc. When you are proactive about it and put things into place earlier on, it makes everybody more comfortable.
It is also a good idea to be looking at your credit terms. You should be looking at what security arrangements you’ve got in place. Don’t put off undertaking that debt recovery process because the longer you leave it, the more likely it is that you’re not going to get paid. Businesses need to understand exactly where they stand going forward, and whether or not they’re going to be able to meet those debts, as the market starts to tighten.
Making sure you know what options are available to you and ensuring you are being financially proactive in how you are running your business is paramount in trying to eliminate any nasty surprises or difficult circumstances. This includes making sure you’re proactively seeking advice when needed by a trusted professional such as a lawyer, accountant, or other financial expert. Of course, things can still happen as a business, but as a business owner, you want to make sure you are as prepared as possible to lessen the affect of any issues that may arise so that you can give your business the best chance of success in the long run!
This blog is based predominantly on the information given in our Law in Life Series, Episode Four: Doing business in the post-COVID world. See the full Law In Life playlist here
Related blog: The post pandemic business impact
The impact of post pandemic business has been quite a game changer for us all in many aspects of our lives but especially in the business world. The business world as we know it has had to adapt as a result. Due to this adaptation, we have all had to change the way that do things. We have learned many things from the pandemic and because of this, maybe COVID has been a blessing in disguise. Here are some of the ways COVID impacted the business world and how it has affected businesses after the fact.
During the COVID pandemic, there were many elements that came into play that made it trickier for businesses to run as usual. We saw restrictions placed, lockdowns occur and a rise in uncertainty for many.
To help during these unprecedented times, government incentives were offered to Australian businesses so that they could keep trading throughout COVID. This included Job Keeper and Job Saver, and outside of that, there was a range of smaller, industry-specific incentives as well. There were a lot of businesses that managed to continue to trade throughout COVID due to these incentives which helped the Australian Economy to stay afloat thanks to the ATO and the State Government. Now that these Government incentives have diminished and “normal” business trading is almost amongst us, some businesses have struggled to stay afloat post lockdown and with restrictions easing. This is because they didn’t have the right infrastructure and business model to be able to support them in these ever-changing times.
Before COVID, we were in a period where everything was a bricks-and-mortar style business blueprint. At the time when COVID first occurred a lot of businesses were still using old-style business models with old infrastructure, long-term leases, and lots of long-term employees, which in hand made it very difficult to adapt quickly. So, what the pandemic has shown businesses, is that having a newer business model and an adaptable approach is the best way to stay at the forefront of the business world. For example, one of the many issues that were faced across a whole range of industries was on the labour side of things, specifically migration. A lot of industries have always relied heavily on migration to keep the workforce flowing. When the borders were closed, no new migrants were coming in, so this made it progressively more difficult to have a consistent workforce and with it, creating problems for businesses. From this, businesses have had to restructure their labour force and create new adaptable ways to continue to run.
Although not all businesses struggled throughout this global pandemic, some for a range of reasons blossomed. These businesses were luckily enough to perhaps be in the right place at the right time in an industry that happened to be advantaged by COVID and the lockdown and thrived as a post pandemic business. It wasn’t just luck though, many of these businesses were seen to have had a double focus approach. Their business owners were not only focusing on the business alone but being more conscious when making decisions on how they could stay agile and adaptable in both their personal life and their business. These businesses were the ones that typically outperformed those that took the opposite approach.
If there’s anything we’ve learned from the last couple of years it is that you need to have an element of agility and adaptability when it comes to your business model and approach, so you can change quickly, scale up or even scale back so that your business can be in a much better position.
Most people, could agree that COVID has been both disastrous and at the same time a big learning curve for all businesses. Unfortunately, many small businesses did not survive through the lockdowns and were unable to recover, even when things began to be ‘normal’ again. Overall, the impact COVID has had on businesses can be seen in a positive light for those who have survived the pandemic, learning resilience and gumption, although not without challenges. It has pushed businesses to change, adapt and modernise their business structures and methods so that they can stay afloat in the ever-changing world that we live in today.
This blog is based predominantly on the information given in our Law in Life Series by Aubrey Brown Lawyers, Episode Four: Doing business in the post-Covid world, supporting post pandemic business. See the full playlist here
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If you are considering buying property in 2022, there are some key considerations that will help you navigate the market. There are many factors at play and a whole process is required when it comes to property. With that, there can be challenges that you may face. We want to help you avoid or minimise those issues.
The property market has been an interesting one over the last few years, to say the least! One big piece of advice right off the bat when it comes to buying a property is to not try and guess what’s going to happen in the future. Don’t try and pick the market, whether it’s from a property perspective or whether it’s from an interest rate perspective.
On the interest rate side of things, you won’t beat the banks. You will be better off spending your time focusing on having the right structure and the right strategy. It’s not all about getting the lowest interest rate. Today it’s about having a suitable strategy that considers all the current risks you’re aware of and all the potential future risks that you should be considering.
By considering the risks when you purchase a property, which is typically the biggest asset that you’re going to purchase, and you take on that level of debt, you do it in a way that’s a long-term sustainable strategy so that you can cope with those outcomes. If that means fixing rates or doing things because you need the certainty around your cash flow, whatever it might be, spend some high-quality time with a financial adviser to support that mortgage broker relationship because it’s not just getting the right product, it’s also getting the right strategy and the right advice to make informed and educated decisions.
Another key bit of advice that ties into the last piece, is all around being ready for purchasing property and getting in early. When buying a property, you don’t just turn up, pick a house, sign for it and it’s yours. There is a process and one you want to be prepared for. For example, again, working with a financial advisor/broker to support you along the way to put yourself in the best position possible. It’s a case of you having all your ducks in a row and making sure that you’re not putting yourself in a stressful position. Preparation is key.
So, are you feeling ready to purchase property this year? Make sure you give yourself the best chance of success by seeking out support from relevant professionals, working together to figure out the best strategy for you and your situation, as well as making sure you give yourself plenty of time to get prepared and have everything lined up so that when the perfect place comes along you will be well and truly ready and raring to go!
This blog is based predominantly on the information given in Stronger Than My Excuses: Aubrey Brown Lawyer’s Law in Life Video Series, Episode Three: The challenges with buying and selling a property in 2022.
The big THREE when joining a board: Is it good for you, the board and the organisation?
Before making the commitment of joining a committee or board, whether you have been asked to join or have put yourself forward, there are certain things you need to think about for ensuring the best interest of everyone involved.
One question to ask yourself before joining a board or committee would be, what are your motivating factors? It could be that you grew up in a family that was heavily involved in different committees so you had the influence of a strong focus on what you could contribute back to your community or various organisations. It could be that you seek out a board or committee you see that may not be functioning as efficiently as it could and, without pushing a personal agenda, you feel like you could make improvements and achieve better outcomes. These are just some examples of motivating factors that could lead you to want to be involved.
Another aspect to consider before making the commitment to join is asking important questions about what your involvement will be and how the board or committee operates. Committees and sports clubs can be very hands-on with the day-to-day functions, whereas being a part of a board could involve being more of a decision making and strategic role. You could ask yourself whether you feel you could add value based on the organisation’s objectives and what it was setting out to achieve. Asking what challenges the organisation as faced is an important question. Another point to raise is to find out how open they are to change. In this case, seeing what kind of appetite the organisation has for improvement is key.
Knowing whether an organisation is a good fit for you is important. If you are a person that likes continual improvement, would an organisation that likes to keep things as they are be the best for both of you?
Something else to consider doing if you have been a part of a committee or board before, is to reflect on any challenges you may have faced or any obstacles you overcame. This is a good way to adapt and learn from those experiences. There can be situations where different personalities come into play, especially on boards with a strong social value attached and board members who are quite passionate. A difference of opinion isn’t always a bad thing, but always remember to be mindful of your own contributions and behaviours so you can park your emotions and think critically. This way, you can learn and integrate with other members moving forward.
There is a lot to know before joining a board, but the key takeaway here is to actively seek to understand the organisation, what is expected of you as a board member, and the time commitment required. Take the time and do your due diligence to make sure you get all the information you need so that you can be sure it is the best decision for you, the board and the organisation.
This blog is based predominantly on the information given during our Law in Life Series, Episode Two: So, you have been asked to join a Board? Watch the full show here.