Michael Kerr presentation @ Regional Living Expo May 2015
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Transcript of Michael Kerr presentation @ Regional Living Expo May 2015
BUY A BUSINESS AND BUY YOURSELF A JOB
MAKE #SEACHANGE #TREECHANGE
HAPPEN
Why are we here today?
11% of Melburnians are planning to move to Regional Victoria in the next 3 years
A further 39% would like to move there ‘one day’
Employment is one of the major issues affecting their planning of their ‘Sea-change’ or ‘Tree-change’ dream
What if there was a way of buying your own job, to enable your move to happen?
It’s called buying an existing small business
We are here to take you through this viable route to gaining the regional lifestyle you and your family are looking for
The alternative to finding a job and working for somebody else is to buy a ’job’ and work for yourself
BUT
How do I buy a small business?
Undertaking this process is like undertaking any major project
It requires a plan, with clear goals in mind
Here is an overview of 6 of the key steps to guide you (there are at least 13)
Owning and running a small business won’t be for everyone – but maybe it is for you?
1. RETHINK JOB ‘HUNTING’
Buying a small business is another way to secure a job
And, employment is not what it was
Outlook for employees less certain
Job options decrease with age
Fewer opportunities in regional areas
Explore this by researching and talking to as many small business operators as you can before “jumping in”.
2. IT’S A MAJOR PROJECT
It involves research, analysis, phone calls, meetings and lots of disciplined follow up
Allow 12-24 months from starting
Ebb’s & Flow’s happen – emotions, change’s of heart but stick at it!
Done well, you will have the choice of more than 1 business to buy
3. WHAT’S FOR SALE?
SO YOU NEED TO
Lots of cafes and food related retail
But more important to know that many businesses that might consider selling aren’t listed for sale
SO THIS PROBABLY WON’T HELP
Hunt – i.e. make direct approaches and ask around
Be clear about what types of businesses suit you and target them?
4. HOW MUCH TO PAY?
Objective = determine (1) what’s left for the owner after everyone is paid and (2) how sustainable is it?
Tax returns and financials don’t tell the story
So know what other information to ask for
5 years side by side on a page – this is not about complex accounting and tax – it’s about cashflow !
We know most of you aren’t Accountants - but with some effort you can break it down
5. WHO DO I NEED TO HELP ME?
Experienced advisors essential
But not necessarily your existing ones
There is a right time for advice
Advice vs opinion – know the difference and be clear what you ask for
6. FINANCING OPTIONS
Banks – security is key
Financiers – Plant & Equipment, Debtors, Stock
Seller (vendor) finance – still formative in Australia – note diff. b/w deferred terms and performance based
Friends & Family
Your own equity – hopefully improved by the lower cost of regional housing
Best result will come from a mix rather than just one form of financing
Potential / Upside:
Invest your capital in your venture
Control of destiny
Can create growth opportunities
Pitfalls:Down to you and only youNew experience (employee to self-employed) may take time to adjust
We’ve helped lots of people through this process – while never simple, it can be incredibly rewarding
So give it serious thought - it might be the difference!
Examples of what you might find
#investinparadise
Examples of what you might find
Online lifestyle retailer
First time offered, highly profitable.
http://bit.ly/1LamFmt
Established e-commerce platform - wine industry (potential in other verticals)
http://bit.ly/1fcxMhq
School photography franchise
Member of successful national franchise. Established 19 years. Experienced staff. Suit buyers with management, sales and business development experience
http://www.kerrcapital.com.au/opportunities#school photography franchise
www.michael-kerr.com.au
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