Business News
Business for sale in Australia-earn more invest less
Why do one invests in market? Simple answer to this question is to increase one’s wealth & money. Obviously everyone would like to earn maximum profits but investing less & increased profits by investing more & so on. This procedure has no limit, the main criteria is that where should one invest to get this maximum/ optimum profits- business for sale in Australia not only posts business that are for sale but also provides specific site location for business type and price quote of the Business for sale in Australia.
Out of Several means of earning profits one is property/ housing industry where after investing a big amount profit entirely depends on the inflation in property to be more than rate of interest as to cover loss of interest & then to say that I have gained something, for eg. if we had invested 20-25 lacs in property, one would have invested only 1 lac to purchase a small & not very healthy business & after spending some time it can be brought to a healthy position & then sold in about 2 lacs, with a profit of 1 lac in 1-2 years, but property would have given inflation of 4-5 lacs in 2 years but loss of interest on 25 lacs @ 14 % interest (minimum rate as per banks) would have been 3.5 lacs/ year. Where the profit is?
Business 2 sell after making it healthy is much more beneficial & handy then to invest in housing industry or share markets, this is much more safer & beneficial. Now a days internet is the most effective way to buy or sell any business, moreover, it provides complete details on every aspect before buying any business,Business for sale in Australia is a way to connect people, buyers to sellers & sellers to buyers, the perfect way to earn profits with wisdom & also ensuring optimum utilization of resources.
Franchise Fitness: 3 Steps To Buying One
Many people dream of becoming their own boss some day. One way to gain entry as an entrepreneur is to buy a franchise. Today, even in this ever challenging economy, there are thousands of franchise opportunities and franchises for sale. According to the International Franchise Association (IFA), a report conducted by PricewaterhouseCoopers found that franchised businesses generate a significant amount of economic activity in the United States, and stimulate still more activity in non-franchised businesses.
This article presents four steps in buying a franchise and, within this context, recognizes two popular categories: restaurants for sale and gas stations for sale.
Step 1: You must be prepared to pay a franchise fee for the operation, and with this you will get a “formula” or system that has already been developed by the franchisor-company. You will have rights to use the franchisor’s name and also benefit from their assistance in the form of: finding a location, receiving a standard operating manual and training, and advisement on marketing and management. Other support may come from a corporate website, newsletters, or periodic workshops, franchisee meetings and brainstorming sessions. For certain, reduced risk comes with buying an established company, yet the franchise fee can be substantial ranging from several thousand dollars to hundreds of thousands of dollars. Other costs include rent, equipment, start-up inventory, operating licensing fee, insurance and possibly a grand opening fee to help promote your business. You may also have to pay royalties to the franchisor based on a percentage of weekly or monthly income. Also, in addition to your own local advertising effort, you may have to pay into the franchisor’s advertising budget.
Step 2: Before you invest, you have to select the franchise that is right for you. Considerations include: investment monies on hand, additional financing funds and the source of that money, desirability and capability to run a specific type of business. For instance, it is quite different if you’re buying a restaurant or buying a gas station as different skill-sets are required. You also have to be good (no, great) at goal setting such as projecting/expecting a specific annual income and committing the hours you are willing to work. The restaurant business can be a daunting labor of love given the fact that you are dealing delicately with food and service, but the hours—not the labor—may be slightly more favorable than running a 24/7 filling station. There are definite pros and cons in both models.
Step 3: The demand for your business and the competition within your category of buying a franchise are as important as your capabilities in running it. Restaurant competition is fierce but also rewarding as most restaurateurs are in this business because they love to please people (sometimes a very hard thing to do). There is a certain temperament and personality—usually A type—that is a “given” in the restaurant biz. In contrast, the 24/7 gas station can almost run itself (not entirely, it needs you!) once fully supplied on the outside with gasoline and fully stocked on the inside with all the extra staple items that people need on the road or on the run when other stores have already put up their closed sign. Whatever direction you take in franchise opportunities the common bond or mantra in sustainability is: “Open for business.”
HOW TO BUY A BUSINESS?
You may find that the idea of running a business appealing, but lose motivation after dealing with the plans, investors, and legal issues associated with opening a new business. Buying an existing business is often a simple and safer alternatives.
Choosing a Business
Locating a business that is profitable for sale at a reasonable price can be a chore, as business owners often have an inflated idea of the market value of their business that is for sale.
Determine ValueA realistic business requires more than looking at past financial statement; it requires a thorough analysis of several years operation and an opinion about the future, the economy and how the company will compete. Majority of people believe that a business should be sold at fair market value. The term Fair Market Value is defined by the IRS at Rev. Ruling 59-60 as follows:
The price at which the property would change hands between a willing buyer and willing seller when the former is not under any compulsion to buy and the latter is not under any compulsion to sell, both parties having reasonable knowledge of relevant facts. There are a number of different ways to determine a fair and equitable price for the sale of the business. Listed below are a few methods:
Capitalized Earning Approach- This method refers to the return on the investment that is expected by an investor.
Excess Earning Method- This method is similar to the capitalized earning method, except that it splits off return on assets from other earnings.
Cash flow Method-This method is usually used when attempting to determine how much of a loan the cash flow of the business will support. The adjusted cash flow is used as a benchmark to measure the firms ability to service debt.
Tangible Assets (Balance Sheet) method-This method values the business by the tangible assets.Value of Specific Intangible Assets method-This method is based upon the buyers buying a wanted intangible asset versus creating it. This method also takes to consideration valuing the goodwill of the business.
Sales Agreement
The sale agreement is the most important document in buying the business assets or stock of a company. Make sure the agreement is correct and contains a;; the terms of the purchase. Have an attorney review the document. In this agreement you should define everything that you intent to purchase of the business, assets, intellectual property, customer lists , and goodwill.
Due Diligence
Licenses and permits. Most business need a licenses and permits to operate it. The type of license or permit you will need depends on what kind of business and your state in which you will operate this business, location, how much you spent to renovation, and where the customers will have to park there car to visit your business.
Zoning RequirementsCheck zoning requirements for the area you are buying your business. It may affect the type of business you are planning to operate.Environmental Concerns
In purchasing real property it is important to check the environmental regulation in the area of purchase.
Closing Checklist
It is important during the closing to make sure you have an attorney available to review all documents necessary for the transfer of the business. The following items should be talk about at closing:
Signing Promissory Note -In some cases, the seller will carry back financing, have an attorney review any Note documentation.
Lease-If you agreed to assume an existing lease, you will be required to execute the assumption. Make sure you have the landlords concurrence to assumption of the lease. You may have negotiated a new lease with the landlord instead of assuming the existing lease.
Bill of Sale-The bill of sale will be proof of the sale of the business and will transfer the ownership of the other tangible business assets not specifically transferred on their own.
Patents, Trademarks and copyrights-May need to execute the necessary forms if it is part of the contract.
Franchise-May have to execute franchise documents if the purchase of the business was a franchise.
Closing Checklist
It is very important that during the closing to have an attorney available to review all documents necessary for the transfer of the business.
Listed are things to be addressed at closing.
Adjust purchase price-This would take care of prorated items such as rent, utilities, and inventory up to the time of closing.
Review documents required to be provided by the seller-These would be a corporate resolution approving the sale, evidence that a corporation is in good standing , or any tax releases that may been promised by the seller. Check with your local secretary of state.
Signing promissory note-in some cases the seller will carry back financing, have an attorney to review any note documents.
Always consult with attorney , CPA , Financial professionals and a Knowledgeable Business Broker and other professionals.
The Challenge in Finding Good Businesses for Sale
As a business buyer, it may seem extremely challenging to find good & profitable businesses for sale. The business re-sale marketplace is not as liquid or robust as the MLS system for selling real estate and this can be frustrating. Below is a summary of why it may be difficult to find a good business for sale in the Toronto, Ontario region and what you can do to increase your chances of finding one.
The business resale market is competitive
The ratio of the number of good businesses for sale to the number of people looking to buy does not coincide with the real estate marketplace. There are simply many more buyers than there are profitable businesses for sale. The key point to remember is that although there may appear to be many business listings online, many of these businesses are not as profitable as they appear to be or have declining sales, profitability or may be mispriced.
Buying a business should almost be approached as a part-time job. If you are looking online, you must sift through the business listings and talk to several sellers before you find a good business to buy.
There is no central clearinghouse for selling a business
The MLS system in Canada is the ‘clearinghouse’ for buying & selling real estate through a realtor. Although there are some businesses listed for sale on the MLS, most are not. The reason for this is that a business broker will typically take on a business seller as an exclusive listing. This means that the agent will work to find the buyer for the company themselves and usually represent both parties in the transaction. The implication for the potential buyer is that there is not central place to go to find a business. So, a person must scour the internet for business listings and talk to several business brokerages to view their exclusive business listings.
Private sellers are usually unqualified to sell a business
Selling a business is a task that typically requires a unique skill set to do it successfully. A good business broker, as an example, will have a background in business valuation, financial analysis, marketing, sale and negotiation. They have usually honed their skills over several deals. A person selling a business privately will lack the network and advertising reach to find a buyer. Many times they also do not price the listing correctly and this results in very few buyers being interested in the business.
Business brokers who are unresponsive
It is a common complaint that some business brokers simply do not return phone calls or emails promptly. It is a common complaint that some business brokerage professionals are sometimes guilty of – it is absolutely inexcusable though.
If you are serious about finding a good and profitable business for sale in the Toronto region you must realize that it is a process that may take some time. Be prepared for a search that can last for a few months. Search the online listings and be tenacious in contacting the business brokers to ensure you get the information you’re looking for.
Do Why are Franchises so Successful?
Did you know that 97% of all franchises opened during the past 5 years are still open? Compare that to the fact that less than 50% of non-franchised businesses are still open after the same timeframe. Why are franchises so successful?
Franchises are successful because they have created a time-tested and well-developed system for running a business. This system takes into account all aspects of running a successful franchise, and nothing is left to chance. The franchisor simply needs to follow the game plan and they will be successful like all of the other franchises in the system.
Since the system is so critical to the success of the franchisee, franchisors offer their franchisees excellent training and very close support during the life of the franchise relationship. Sometimes franchisees get frustrated because franchisors offer very little leeway in the way things are done, but franchisees must understand that this is done for the good of both the individual franchisee and for the of the overall franchise organization as a whole.
If you are looking for a proven way to own your own successful business, and don’t mind giving up most of the creative control associated with developing that business, then a franchise could be perfect for you. There is less risk and more support to open a franchised business than there is to starting a new business from scratch. And resale values are often higher as well.
If franchising sounds interesting to you, there are thousands of franchise opportunities across nearly every industry. Start your search today to find the perfect franchise for you – you’ll be glad you did!
Resources
Find the perfect business to buy or franchise opportunity to buy,To find a broker to help you buy or sell a business, visit BrokerSourceSell a business or sell a franchise or business opportunity fast when you list it for sale online.
Tips for Buying Businesses for Sale
Having a business of our own not only fetches all the profits raised through it but also gives us all the powers to run the business according to our own rules and regulations, so always consider buying the businesses for sale. A person in a job not only works under pressure of deadlines but also the fear of bosses that they may punish you in case you commit a mistake. Also in jobs, one gets only a portion of the total income generated through his own work. Running your own business makes you the boss, though you still need to work on set priorities and deliver the work by deadline, you need not to answer to anyone apart from your clients and customers. In business, you take all the money generated through your work rather than only getting a portion of it.
In today’s scenario, countries are facing economic crisis affecting the world economy, so it is a better idea to purchase businesses for sale from various vendors, as it not only takes too much of capital requirement but also takes years to properly establish a whole new business from scratch. With already established businesses it becomes easier to start earning higher profits rather than earn on small opportunities which is mostly the case with newly started businesses.
Before you consider buying businesses for sale, do proper home work. Research all the options available to you as it’s a big decision and even one small mistake may cause you big money. Many people before purchasing the businesses for sale doubt the credibility of the seller and often question as to why the seller wants to sell the business if it is for fetching a handsome amount of money, then it may indicate the business is having financial profitability issues. There may be many reasons why entrepreneurs decide to list businesses for sale. One could be the lack of heir to continue the business further, another may be the owner wants to retire, or maybe they are moving, etc. The reason could be anything, whether it is financial or otherwise, it should not let the prospective buyer debar from purchasing it only because of a doubt. It is advisable to correctly know the genuine reason behind a seller listing businesses for sale. It’s also advisable to have the business for sale appraised and make the final decision after getting an appraisal on the business for sale.
Buying a business can turn out to be a turning point of your life. You just need to follow the right path and emerge as a successful businessman taking care of all the necessary business dealings to stay on track and continue researching while executing the right business plan.
Buy a Business or Start Your Own?
Wouldn’t it be great if instead of going through the hassle and hundreds of hours spent on developing a business plan and starting a business, we could just buy one already launched? Maybe. The thought certainly sounds tempting. Especially when you start searching for viable data that you can rely on when developing your business plan and you discover that an industry report costs thousands of dollars. Without it, the reliability of the data you base your financials upon doesn’t even sound realistic to you. Even less to an investor whom you plan to turn into a partner or an associate…
Maybe it would be great if we could just avoid these moments that create headaches and nightmares and purchase the already launched business.
On the other hand, buying a venture it’s like buying a used computer: you don’t know what problems it has and whether it already has any viruses until you bought it and then it might be too late.Yes…it’s true: buying a business helps avoiding the pain of planning and launching your own, and starting operations from scratch.
Buying a business means already having a brand name, loyal customers and well defined products, services and developed growth strategies. If the business was successful, you have the responsibility to maintain the image the previous management team created. If the business was not successful and you plan on buying it….well, why are you buying it? Finding the reason why the business is sold is very important.
There may be various reasons: lack of expertise of the management team, low quality of products, limited resources to develop better products or to offer better services, etc. Finding this reason is the most important action that must be taken when intending to buy a business and it must be done by a professional who can analyze all aspects of the company.
Secondly, the image the business has is very important as well. Talk to your future competitors, your future customers and the business’ suppliers and find out what the challenges of the industry are and what their opinion is of the business you’re about to buy.
Based on their responses, find out if after you buy the business, you can satisfy their suggestions. And most importantly, develop the business plan. Don’t think that just because you are buying an already launched business you are off the hook. You still have to develop the business plan containing your pro forma financials to see what are the forecasted expenses and revenues for the first five years of operations after you buy it.
After the expert will analyze the business and you will finish the industry and market research, you will have a good idea of the chances of success the business has in the future and you will be ready to make a decision and plan accordingly.
Is it better to buy a business than start from scratch? Probably not.
When you start from scratch, you don’t find yourself in the situation of fixing the mistakes the previous management team made, mistakes that reflect on the current revenues. Depending on your expertise with start-up companies, starting your own business gives you flexibility when it comes to time and resources. It helps you through your learning curve.
Buying an already launched business doesn’t wait for you to catch up. You must be ready to play the game according to the previous management team’s rules and try to change them on the way.
Unless you keep the previous management team, it can be very overwhelming and tiring.But if buying a business seems more challenging to you and a great challenge is what you are looking for, you have two options: buy a company’s assets or buy the company as a going concern. You should choose the option that is most advantageous to your goals, but no matter what option you choose, make sure you run an investigation of the current situation and estimate the future prospects.
If you want to buy a company’s assets, whether it’s equipment, location or anything else, make sure the bill of sale specifies exactly what you are going to purchase, with detailed descriptions, prices and attached key documents, and make sure all liabilities associated are mentioned.
Generally, it is better to use this type of purchase when the company has many hidden assets that the management team is not aware of and has not capitalized on yet.
If you buy the business as a going concern, it means that you want to own some assets which can be transferred otherwise. Buying this way requires hiring an attorney, a business broker or a business appraiser and the process is complicated by a long, complex and intensive investigation. However, the investigation will help you not overpay for the business.
Businesses for Sale in Kitchener, Ontario
If you are searching for businesses for sale in Kitchener, Ontario there are some excellent opportunities to explore. Before you embark on your search for a new business though, how familiar are you with the city of Kitchener, Ontario and its local business climate? This article is a brief overview, for your reference.
Three for the price of one!The city of Kitchener is sometimes referred to as KW or “Kitchener-Waterloo” as the city of Waterloo is adjacent directly to the north. It is also referred to a the ‘tri-cities’ or ‘tri-city area’ as the smaller city of Cambridge is adjacent directly to the south. Kitchener’s population is just over 200,000 residents while the population of the tri-city area is over 450,000 combined. The implication for you as a business buyer is the size of the market, three cities in such proximity to one another. If you are looking for a small business for sale in Kitchener, think about the market impacts that Cambridge and Waterloo could have on your operations as well.
Economic DiversityKitchener, Ontario has its roots in manufacturing. Approximately 25% of the work force is involved in the manufacturing / industrial sector. During the economic downturn, this sector has been hit deeper than other sectors of the economy such as health care or even technology. That being said, there is an abundance of skilled labour in the city and the Kitchener can be said to be experiencing a shift away from the downtown. Kitchener’s downtown is less dynamic today than it once was but economic growth and building has taken pace in the periphery of the city, in its suburban areas. In Waterloo, there are 2 major universities and several technology companies have head offices here, including Research in Motion (RIM).
TransportationKitchener has an excellent transportation infrastructure. The Conestoga Parkway is a major thoroughfare across the city and the city is served well by rail, public transit and the Region of Waterloo International Airport is close by. If you are thinking of businesses for sale in Kitchener and transportation is an issue for your success, contact the city for more information.
LocationKitchener is located in southwestern Ontario. It is a short drive away from London, Hamilton and Toronto. The city is right off of the Hwy 401. If you are searching for businesses for sale in Kitchener that depend on a central Ontario location, accessibility to major markets and customers then you should think about some of the benefits that operating a business in Kitchener can do for you.
Range of Business OpportunitiesThere are a wide variety of business opportunities available in Kitchener – if this is where you want to purchase a company. There are the traditional small business opportunities like retail, flower shops, restaurants, gas stations, car washes and service businesses. But there are also many options to consider in the manufacturing industry and distribution as well. If you are serious about buying a business for sale in Kitchener you should contact a business broker (or ‘sales representative’) to discuss the options. Also, contact your lawyer and accountant as well, as their services will be needed during any business sale transaction.
Buy a Business
There are no guarantees in business and the risks must always be managed, buying an established business clearly offers significant advantages merit considering if you want to own your own business. In order to buy the right business or franchise, you need to investigate its historical performance, operations, current status, staff and management, competition, industry and its future potential, all of which is so much easier to do with an existing business.
Buying an existing business can be easier than starting one from scratch. Developing your own ideas and building the company from the ground up. In most cases, buying an existing business is less risky than starting from scratch. When you buy a business, you take over an operation that’s already generating cash flow and profits. You have an established customer base, reputation and employees who are familiar with all aspects of the business.
Buying a business, regardless of its size, can be a complex process. “You will want to enlist the help of a qualified attorney and a certified public accountant, as well as any other trusted advisors. These advisors are essential to what is called “due diligence”, which means reviewing and verifying all the relevant information about the business you are considering. When due diligence is done, you will know just what you are buying and from whom. In terms of the numbers and financial side of your vetting process, select a certified public accountant that has experience in analyzing several years’ worth of financial statements and tax returns provided by the seller. Your accountant should also understand any tax consequences associated with the purchase and structure of the deal.
There will be differing views on what the business is worth. Regardless of whether the seller has a desired asking price, you will want to come to your own conclusions about the value of the business. So be ready to negotiate and bridge the inevitable gap between what you think the business is worth and what the seller wants. You also need to assess the company’s reputation and the strength of its business relationships. Talk to existing customers, suppliers and vendors about their relationships with the business. Contact the Better Business Bureau, industry associations and licensing and credit-reporting agencies to make sure there are no complaints against the business.
If you’ve thoroughly investigated a company and wish to go ahead with a purchase, there are a few more steps you’ll have to take. First, you and the owner will have to agree on a fair purchase price. A good way to do this is to hire an experienced appraiser who can estimate the company’s fair market value.
If all goes well, you and the business owner will agree on a fair price as well as other aspects of the purchase, written sales agreement and possibly have a lawyer review it before you sign on the dotted line.
What to look for when buying a Business?
In the past year or so several good businesses faced downturn due to economic conditions and turmoil in the financial and credit markets. Even though the underlying business model may be strong, due to several uncontrolled circumstances related to the owner’s and partner’s personal finances or credit leverage, these businesses may be for sale. As in every crisis, this has created some very good opportunities to buy good businesses at very low prices.
Businesses that have a sound business and financial model are likely to flourish and grow as the economic activity picks up. This may be the perfect time for investors and entrepreneurs with good credit and access to investment funds to benefit by buying these successful businesses at a relatively lower price and set up a new small business. But before you jump in and invest your hard earned savings into your dream business, you may want to conduct a thorough due diligence to make sure the business is right for you.
Examine a Business before buying
Here are the top 5 things you must do before buying any business. The time and effort you will spend upfront in the due diligence process will go a long way to determine your future success.
#1: Analyze the Business Environment
Once you have narrowed your choice of business that you want to buy, conduct a thorough analysis of the business and its surrounding environment. Look into every aspect of the business including its suppliers; marketing material; list of competitors; location competitiveness in case of a retail outlet; leases and contracts; bank loans, collateral and covenant obligations. Make sure your due diligence discovers all obligations that the business may have entered into during the course of its existence.
#2: Hire Professional Help
A qualified attorney and an accountant will be your best allies as you evaluate the legal and financial condition of the business you are about to purchase.
You will require help from an attorney to review several legal documents including existing lease agreements; contracts with customers and suppliers; and also prepare documents that will legally transfer the ownership of the business or its assets in your name.
At K&M Accounting and Tax Services we help clients review the business financial statements and tax returns to determine the profitability of the business. Structuring the actual transaction also has several tax benefits for the purchaser and the seller. These can become important leverage points during price negotiations.
#3: Cross Examine the Financial Statements
If the business has been in existence for a long time, make sure you review financial statements for at least 3 to 5 years. Don’t accept a simple financial review by the seller. Validate the records by looking at the sales and payroll tax reports, supplier invoices and levels of inventory carried throughout the year.
The true value of the business is the free cash flow that it can generate over the next 3 to 5 years. A thorough cash flow forecast will enable you to determine the true value of the business. For more on business evaluation and information on setting up new businesses in Charlotte and Carolinas visit www.kmaccountant.com.
#4: Comparison with Industry Benchmark
Every industry has a bench mark study of the financial and business performance ratios that can be used to compare your business against other similar businesses in the industry. If you are buying a franchised business, you may be able to request a benchmark report that compares the business against other franchise locations from the broker representing the seller.
This is perhaps the most valuable data point that can help you analyze and discover turnaround opportunities. You will be able to find out what may be wrong with the business, where can you make improvements and turn the business around.
#5: Management Difference
Before you sign up for the business, take a hard look at your own management skills and expertise. Many businesses require special skills and years of industry experience to be successful. If you are a software programmer venturing into a retail fast food business for the first time, perhaps you may want to consider taking someone with the relevant skills and experience in the industry as your partner.
Being an entrepreneur requires one to wear multiple hats managing marketing, production, delivery, vendor purchases, customer service, financing, legal and tax issues all at the same time. This can sometimes prove to be a difficult move from the comforts of a corporate job although those that are able to make the shift successfully reap huge benefits.
Keep in mind this column and the articles published here are only meant to provide you with high level information about tax and business matters and in no way should you consider this as tax advice. Consult your tax and legal advisors regarding your individual tax and business situation.
This Article provides only an overview to the complex Tax Laws. It is not exhaustive nor a substitute for Independent Tax Advice provided by a Tax Accountant or a Tax Attorney familiar with your case.
