How to Buy a Business
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Transcript of How to Buy a Business
BCI Business Brokers
Buy A Business
Don’t Lose Your Shirt
BCI Business Brokers
BCI Business Brokers
1. Your Objectives2. Plus and Minus of Small Business3. How to Investigate4. Pitfalls5. Building Wealth6. Franchise v Non-Franchise7. How much to pay8. What’s “Hot”
Information Night
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What do you want
to learn tonight?
Information Night
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“Half of my marketing budget is wasted - But
I’m not sure which half.” Lord Leverhulme
Quotation
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“High Percentage of Businesses Fail in the
First Years”
Quotation
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Here
How can I be sure to end up…
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Not Here
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Answer These Questions What would be the main reason for you
going into business?
What are you most concerned about when thinking about buying a business?
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Reasons People buy a Franchise
LifestyleBrand Security and SupportSelf DirecitonIncomeSkillsOther
33%
27%
19%
16%1%3%
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Describe Your Ideal Business
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Add It UpGood Side Freedom/Lifestyle Control/Certainty “My Business” Wealth No Limit
Bad Side Lose Assets No Holidays Long Hours Always “on” Stuff
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Questions to Ask the Vendor Is the business making money? Where is the proof? How important is owner to business? Will I be trained and supported? Does he own other businesses? What systems are there?
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Questions to Ask Yourself Will I like it? Will the goodwill transfer to me? Where are we in the economic cycle? How is the industry? Will I grow the business? Will I be able to sell it?
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•Wrong reasons•Insufficient Capital•Not enough research•Murphy’s Law•Giving up too early (Health, psychology)•Not enough answers
Major PitfallsMajor Pitfalls
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Your ChoiceYour Choice
Cost Support Answers Brand Freedom
Startup√ X X X √
FranchX √ √ √ X
Non
Franch√ X √ X √
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Your Ideal BusinessYour Ideal Business
Successful FoundationSuccessful Foundation
Product or ServiceProduct or Service
GrowthGrowth
AnswersAnswers Right For YouRight
For You
SystemsSystemsTransferableTransferable
BrandBrand
ProfitableProfitable
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Survival
The JourneysThe Journeys
Growth
New
Change$$
Challenge
Expectations
Support
StrategyExpertis
e
Courage
Investors
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The Key to Building Wealth in Small Business
Building WealthBuilding Wealth
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Kiyosaki’s Cashflow QuadrantKiyosaki’s Cashflow Quadrant
JobInvestment
Self
EmploymentBusiness
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Franchise or Non-FranchiseFranchise or Non-Franchise
Franchise Buyers Inexperienced Can Follow System Risk averse Likes teamwork
Non-Franch Buyers Independent Pro-risk Disciplined Free-Spirit
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What’s worth more?
Appraise business
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Risk and ReturnRisk and Return
Risk
% Return pa
Bonds
CommercialProperty
Bank
Shares
SmallBusiness
3 5 8 10 20
ResidentialProperty
30
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Risk and Return by Business TypeRisk and Return by Business Type
Low
ROI %
Growth IndustryLarger businessesStrong BrandProtection by LawOngoing Income
Personal sellingUnfashionableReliant on ownerEasy entry by competitorsLittle Infrastructure
High 50-90
30
15-20
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Risk and Return by IndustryRisk and Return by Industry
Low
Service RetailCleaningReal EstateSmall Manuf.
ROI %
High 50-90
30
15-20
Property ManagementCaravan ParkFranchiseMortgage BrokerFinancial Planner
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What’s Hot Franchise Online Business Home Business Tied to necessity Serving the aging demographic Health related
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Thank You
Success in business requires training and discipline and hard work. But if you're not frightened by these things, the opportunities are just as great today as they ever were.
David Rockerfeller
BCI Business Brokers
BCI Business Brokers
If you would like to sit down with Tony Arena to discuss any
business opportunity or see what businesses we have for sale
contactTony Arena 61 2 9439 3399
[email protected]://www.bc.com.au