Post on 14-Apr-2017
Looking for a business consultant who tackles your implementation,not watches from the sidelines?
Introducing a new profit stream into your business:A pro active Business Advisory Consultancy,
specializing in Succession and Estate
Planning (ensuring your clients receive
the advice they need and… see the light).
No will
No succession plan
(for themselves or their business)
No clue?
Do you know what % of your clients
have:
? ?SucceSSion & eState Planning - BuSineSS adviSory conSultancy BuSineSS adviSory conSultancy - SucceSSion & eState Planning 3
Succession planning applies the day you think about commencing a business and continues throughout its life..
In 2020, the baby boomers generation (those born between 1946 and 1964) will be aged between 56 and 74
years of age with the weighting heavily towards the older end of the scale. The outcome will most likely be that
by 2020 a significant number of baby boomers will have or will
be in the process of transferring ownership of their business.
In Australia, the estimated value of these businesses is around
$3.5 trillion. The next 7-10 years represents a period of opportunity and risk.
Opportunity will lie in:
• movingaheadofthebottleneckthatmayariseifmanybusinessestrytoexitatthesametime;• planningandactinginyoursuccessionnow,and• looking foropportunities toacquire,mergeor formallianceswithotherbusinesseswithastrategyofeither
growingtoexitorgrowingtostayandimprovecompetitiveness.
Risk lies in complacencyandinaction,resultingineithermissingopportunitiesorsimplybeingleftbehind.
Succession is a sleeping giant that is about to awake
and one which many business owners do not even
recognise will impact them directly.
Providing
Succession Planning for your professional clients
open the door to a huge opportunity
with no distraction from your billable hours
? ?SucceSSion & eState Planning - BuSineSS adviSory conSultancy BuSineSS adviSory conSultancy - SucceSSion & eState Planning
it’s time to take
succession planning out
of your too hard basket
andrecogniseit’svalue
to your firm.
3 2
What Is Succession All About?
Whenyoumentiontheword‘succession’thecommonreactionistothinkof‘retirement’.WhetheritistheCEOofapubliccompanyorintheprivatecompanyarena,theconnectionisimmediateandusuallywithoutexception.
Forprivatecompanies,successionconnectswiththefounderand/orownerretiringandsellingouttoathirdpartyorpassingovercontroltoafamilymember.Whilstthesecommonlyheldviewsofsuccessionmightnotbeincorrect,theydonotaccuratelyreflectwhatshouldbetherealfocusofsuccessionplanningforprivatecompanies.
The eventual retirement of a founder and/or owner may well be an outcome of a succession process
but it is certainly not its purpose. Succession is the process of ensuring the continuity of a business
beyond its current management. This is achieved through identifying and understanding the capital
value drivers of the business, the elements that allow it to compete effectively in its markets, and
growing and investing in those drivers.
Afocusoncapitalvaluedriversallowsnotonlyforeffectivesuccession,butalsosupportsandallowsacompoundingofthebusiness’capitalvalueoveritslife.
Wethinkofsuccessionplanningasaprocessofevolution–BusinessEvolution.Enablingthecompoundingofwealthfromgenerationtogenerationwhileensuring familyunity, individualgrowthandasenseofcontribution, this is theessenceofsuccessionplanning,thisisBusinessEvolution.
Which of your clients need a succession plan?
Successionplanning isakeyconcern foranyonewhohas founded,ownsorhasanequity interest inbusinessestrading under a private company structure or public company where they continue to hold a significant controlling interest.
Yourwealth ismaterially impactedby your ability to realise and /or transfer that interest to a thirdparty or familymembers.Ifyouownaminorshareholdinginapubliclylistedcompanyrealisingortransferringitsvalueisrelativelyeasy,howeverwithprivatelyownedbusinessesorasignificantcontrollinginterestinlistedcompanies,realisingandtransferringvalueisaverydifferentprocess.
Succession planning starts the day you commence your business
and continues until the business no longer exists or you release your interest.
Succession planning is important for family businesses, small businesses,mediumand large businesses, closelyheld businesses, privately owned businesses and a significant controlling interest in publicly listed businesses. Howeveryoudescribeyourbusiness,successionisfundamentalindeterminingthe‘capitalvalue,worth,marketprice’ofyourbusiness,andthereforeyourandyourfamily’swealth.
Issues Faced by SME’S
SomeoftheissuesfacedbySMEownersisthey….
• Spendtoomuchtimeworkinginthebusiness,notonit• Struggletoattract,retainandmotivatestaff
• Recordnumbersareexpectingtoretire,floodingthemarket• Generationalsuccessorsarenotinterested
• Notpreparedorplanningforsuccessionorretirement• Unawareoftheirbusinessvaluegapandunder-ornotinsured
Source: Bendigo Bank pilot program, December 2008
Thesurveyalsofoundthat:
• 75%ofSMEssurveyeddon’thaveadetailedplanforthefuture• 61%consider“now”asthemostimportanttimeforplanning
•86%don’thaveasuccessionplan• 41%don’tknowtheirbusiness’worth
•71%don’thaveanestateplan• 88%wouldliketodevelopaplanforthefuture
SMEsneedmore–andbetteradvice
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Identifying why your clients need help
Therealityisthatpeople,despitetheirbestefforts,createmessandcomplexityacrossthevariouspartsoftheirlives.Manyattempttoignorethismess,perhapsignoranttothefactthatatsomepoint,eithertheyorsomebodyelsewillhavetomakesenseofitall.
Unfortunately, thishabitualprocrastinationbypeopleand/or their advisers toooften leads to significant emotionaltrauma,financiallossandrelationshipdislocation.
Professional advisershave, for generations, recognised thedownside topoormanagement andplanningby theirclients across a diverse range of areas from business and succession planning to estate and financial planning(amongst others).
Yet thecomplexityof the issues, thediversityofeachperson’ssituation,and thebreadthofskillsandknowledgeneededtoaddresstheissueshasmeantthatmostpeople-andtheiradvisers-putthesecriticalplanningactivitiesintothe‘toohard’basket.
Untilnow.
WelcometoreG3n,acloud-basedsolution(designedbyadvisersforadvisers)thatthrivesonturningthecomplexintotheunderstandable.reG3nenablesreactive,transactionaladviserstogenuinelydeliverperpetuallife-changingvaluetotheirclients,aswellastheirclient’sfamiliesandcommunities.
reG3nmovesadvisersfromthereactivevaluefringetohigh-quality,recurringstrategicengagements.
OrbitutilizesreG3nasthesystemtodeliveritsBusinessSuccessionProgramsolutionstoaccountingfirms.Orbitwilldevelopbespoke,customizedsolutionsforyourpracticetomeetthespecificneedsofyourclientsandtherebyprovideaverypowerfulandimpactfulservicetoassistyourclients.
Streamlining implementation & data storage (with reg3n)
Cleanly capturing information
Toooften,aclient’sinformationendsupasacollectionofscribbledortypednotes,out-of-datedocuments,fact-findsandmultiplespreadsheets.Findingaparticularpieceof information issomethingakintoatreasurehuntwhere‘x’marksanentiresectionofdocuments.Inaddition,theinformationcollectedcanvarywidelyfromadvisertoadviser,dependingontheirexperienceandworkingstyle.
reG3nchanges this. Itprovidesaneasilyaccessibleand logical structure tocaptureaclient’s informationso thateverythingisinoneplace-yourdigitalorganiserandfilingcabinetforallclientinformationcollectedduringtheplanningprocess.
reG3nstoreseverythingfromanorganisation’sbackgroundinformation,oranowner’sfinancialobjectives,tospecificinformationonthesaleortransferofallorpartofanorganisation.Itprovidestheadviserwithaframeworkforcollectinginformationandallowsthemtofindthatinformationagainquicklyandeasily.
Simply storing large volumes of information
Aftercollectinginformationfromaclient,itcanbeoverwhelmingtobeconfrontedwithalargefileofinformationtosortthroughandpiecetogether.Withcrucialinformationscatteredacrossmultipledocuments,itcanbeaheadachetoassembleeverythingandseethebigpicture.
reG3ncombinesstructurewithflexibilitytoarrangethismassofinformationintothreecoreareas:organisation,peopleand actions.
The‘organisation’and‘people’areasformthebasisoftheinformationcollectionprocess.Alessexperiencedadvisercanusethequestionsasaguidewhenrequestinginformationfromclients,whileamoreexperiencedadvisermaysimplyusethemtostoretheinformationtheyreceive.
The ‘action’ area uses the client’s information and assists the adviser with standard planning activities, such asanalysingbusinessperformance,performingbusinessappraisals(andvaluations,ifsuitablyqualified),andfacilitatingthe sale or transfer of a business.
It’ssimpleenoughthatanotheradvisercantakeoveraclient’sfile,andseeallcrucialinformationataglanceonthedashboard.
The right tools for delicate subjects (understanding your client)
Theadvisoryprocessismorethanjustanalysingnumbersanddata.It’sabouthelpingpeopleplanaheadtoachievetheirdesiredqualityoflifeorsimplifytransitionalphasesthroughtoeachperson’sultimateexit-death.
reG3ngivesadviserstoolstohelpthemaddresspotentiallydelicatesubjectswithclientsandgainabetterunderstandingof where their client wants to be. It provides customisable collateral for engaging with clients, surveys to betterunderstandtheirlongandshort-termrequirementsandgoals,aswellaswhat’simportanttothem.
reG3nprovidesadviserswithvisual (andother) tools togainabiggerpictureunderstandingof theclientand theirbusiness,sotheycandeterminewhichareasrequireimmediateactionandthosethatrequirefutureattention.
Produces informative reports
Dataismeaninglessifit’ssimplystoredawayandquicklyforgotten.reG3nensuresinformationiscurrentandperpetuallymeaningful,enablingadviserstoshareanddiscussitwiththeirclientsinarelevant,simpleformat.Itprovidesclean,easy-to-readreportsbasedontheinformationtheadviserhasstoredinthesystem.
Thereareawidevarietyofreportsthatprovideanoverviewoftheorganisation,theownersandotherrelatedparties,structures,conflictsofinterest,andactionplans.Forthoseusingthevaluationtool,reG3ncanalsoproduceeditablebusinessappraisalsandvaluationreports(ifundertakenbyasuitablyqualifiedadviser).
?BuSineSS adviSory conSultancy - SucceSSion & eState Planning3
Complexity, cost and procrastination are problems of the past
Asatechnicalareaofadvice,EstatePlanning(EP)canbeverycomplexandtimeconsuming.Inaddition,EPinvolvesskillsacrossabroadrangeofadvisers(whichalsoaddsaprojectmanagementfunctiontothesituation).Theseissuesalonemeanthatthereisalackofcoordination,workisdoneinefficiently,differentadvisersareworkingwithdifferentpiecesofinformationandcostsfordoingtheworkbecomeprohibitive.Addingfurthercomplicationisthefactthatpeopleareoftenuncomfortableaddressingtheirmortality,theyarescaredofthecostsandthereforeconstantlyprocrastinateindealingwiththeissues.Theendresultisthatmostclientsdon’tgettheadviceanddirectiontheyneed,theiraffairsremainoutofcontrolandadvicebusinessesfailtobenefitfromthelegitimatecommercialopportunityEPoffers.
Be the ‘Family Manager’ for your client
EPisauniqueareaofadvicethatnaturallyintersectsallrelationshipsassociatedwithaperson-fromthefamily,tothoseassociatedwiththeirbusiness/professionallife,tothoseintheircommunity.ThehighvalueopportunityforanadvicebusinessistopositionthemselvesastheFamilyManagerfortheclient.Thisisthemostvaluablerolethatcanbeundertakenwithaclientandmeanstheadvicebusinessisengagedwiththeclientatthestrategic/managementlevel.Thisnon-advicerolecanbestructuredasamonthlyorannualfeeandensuresthattheadvicebusinesssitsatthemiddleoftheclient’saffairsandstructurallyengagesthemwithalltheclient’sotheradvisersandrelationships.
The app: cutting time and costs (Estate Planning For Life)
Untilnow,fillingthisrolehasonlybeenpossibleforthosewealthyclientswiththeresourcestopayforateamofadvisersortheirownpersonalbusinessmanager.However,thankstotheEstatePlanningForLife(EPFL)app,anadvisercannowpositionthemselvesastheFamilyManagerwithalmostanyclient,bringorderandcontroltothefamily,andveryefficientlycreateawholenewEPbusinessthatdriveshighvalueandannualised(highmargin)revenue.
Benefits for your business and your clients
EPFLenablesadvicebusinessestogenuinelyconnectwiththeirclientsatamorestrategicmanagementlevel.WithEPFL,thisrelationshipisauthenticallyvaluableforboththeclientandtheadvicebusiness.Thebenefitstotheclientareobvious,providingthemwithgreatercontrol,security,confidenceandtransparencyoftheiraffairs.Inaddition,itensuresthatalltheiradvisersareworkinginunison.Fortheadvicebusiness,thebenefitsaresubstantial.EPFL:
• Repositionstheroleoftheadviser• Drivesanewand/orexpandedareaofthebusinessoffer• AllowsEPtobecomeanannuityincomestreamareaofthebusiness• Identifiessignificantadditionaltransactionaladvicework• Providesabasisfortheclienttocomebackandreviewtheirsituationeachyear(andhavetheirdocumentsfrom
the system updated)• Connectsadvicebusinesseswithalltheotherkeyrelationshipstheirclienthas(creatingnewclientrelationships)• Significantlyimprovesthevaluepropositionoftheadvicebusinessreducingthepotentiallossoftheclient
From an advisers (accountant, financial planner, lawyer, consultant) perspective, they have a professionalresponsibility (legal,ethicalandemotional) toensurethattheirclientsarepreparedforthisevent.However, inmostcases(eventhosewithlegalandcurrentdocumentsinplace),clientsandtheiradvisersarenotpreparedforaperson’sdeath.Therearesignificanttechnical,management,emotionalandcommercialreasonsforthis.
Providing
Estate Planning for your professional clientsindividual needs
the harsh reality is that there is
no person alive today who will not die
at some point in the future. this means that
having to deal with aperson’sestate isnotonlyapossibleevent,
it is inevitable.
?BuSineSS adviSory conSultancy - SucceSSion & eState Planning3 2
Orbit has developed a bespoke consulting
solution for delivering a complete Succession consulting
solution to a select number of accounting firms.
Orbit will provide to an accounting practice:
• Systems and processestoidentifyclientneedsandproviderecommendations
• Resources to project managetherequiredactionsandbeaccountable
• A senior consultant to represent the firmasits“BusinessSuccession/EstatePlanningStrategist”
• The ability to deliver this important servicetoitsclientswhichisfarmoreholisticthantraditionaltaxrelatedwork
• The opportunity to identify ongoing future projectswithongoingrevenuepotentialforthefirm and its referral partners
• Rain making capacity to generate new workfromtheclientsofitsreferralpartnersbyactivelypromotingthisnewfound,anduniquecapacitywhichindustryresearchsaysisalmostnonexistent.
• An ability to identify client needs and facilitate a solution
• Marketingresourcestoactivelypromotethefirmandthisnew,uniqueservicetoreferralpartnerseglawfirms,banksandseekingtogeneratenewclientengagements
• Introduction of industry expertstoassistclientsinareasofestateplanning,tax,capitalraising,businesssale,finance,assetprotection,insurance,successionfunding
• OpportunitytoexplorethepotentialtoestablishaVirtualFamilyManagerservicetopositionthefirmasthetrustedadvisortoyourclientsfamilieswherebyyoucoordinateallmajorfinancialissuesasbothagatekeeperandprojectmanager.
Be proactive and valuable
Estateplanningoffersaunique,lowcostsolutiontoamassive,highimpactproblem.ByusingandfollowingtheEPFLprocess,yourclientswillengagewithyouonanemotional,practicalandcommerciallevelinawaythatdoesnotleavetheclientfeelingoverwhelmedbytechnicalinformation.Engageandconnectwithyourclientsinanewwaythathasthemseeingyourrolewithadifferentperspective.
To provide a business succession champion
The Orbit
Solution
? SucceSSion & eState Planning - BuSineSS adviSory conSultancy
Orbit’s Proposal
Toenableyourfirmtoaccessthesignificantopportunitieswithinyourclientbaseandexternalrelationships,Orbitwillundertaketoprovidethefollowingservices:
• AccesstoaSeniorConsultant(MatthewBrannelly)whowillattendyourofficeseachweek• CoordinationoftheproposedBusinessAdvisoryDivisionwithinyourpracticewithspecificemphasisonEstate
Planning and Succession Planning • Establishmentofsystemsnecessarytodelivertheseservices• Marketingresourcestopromotethisnewserviceexternallytothefirm’sconnectionsegbanks,lawfirms• TheserviceswillbeprovidedbyMBrannelly,representingyourfirmasthe“SuccessionStrategist/Specialist“
Revenue Potential
Individuals:
• EstatePlanning–consultingfees$3,000• RiskInsurance-$5,000• Legal-$2,500
Businesses:
• SuccessionPlanning–consultingfees$10,000• RiskInsurance-$20,000• Legal-$10,000
NewRevenueProjections
5xindividualEstatePlansperweek
(consultingfeesof$15,000pw)
10xindividualEstatePlansperweek
Plus revenue from: risk insurance and legal and succession planning projects.
the potential opportunities and
revenue available
from succession planning & estate planning are
too strong for any firm to ignore. Theobstacleuntilnowformostfirmshasbeenthe
lack of time and resources availabletocommit.ThankstoOrbit,thesepastissuesare
no longer a limitation.
=$750Kper annum
=$1.5Mper annum
call 0419 222 344 and get your accounting firm on target.
E info@orbitstrategies.com.au W orbitstrategies.com.au
PO Box 598, Clayfield, Q, 4011
New ReveNue thRough SucceSSioN PlaNNiNg eState PlaNNiNg