questions on selling a bussiness

[norm1981]

Hi i am new here and am looking for an exit strategy
And dont know where to start
I have a business turning over 800000
net profit is 350000-400000 for the last 3 years

600000 grand worth of assets

How do i value my business and what should i ask for

I own the property and wish to sell the business and lease the factory out to a new owner

factory worth 1.1 mil

Anyone able to help me out on this one

Or any advice on who to ask

you people are the best

[James Millar]

norm1981, post: 269831, member: 117914 wrote:

Hi i am new here and am looking for an exit strategy
And dont know where to start
I have a business turning over 800000
net profit is 350000-400000 for the last 3 years

600000 grand worth of assets

How do i value my business and what should i ask for

I own the property and wish to sell the business and lease the factory out to a new owner

factory worth 1.1 mil

Anyone able to help me out on this one

Or any advice on who to ask

you people are the best

What did your accountant have to say about it?

Helping build better businesses and better lives with expert financial and taxation advice. info@360partners.com.au www.360partners.com.au 03 9005 4900

[Paul – FS Concierge]

Hi and welcome to Flying Solo [USER=117914]@norm1981[/USER]

It sounds like you have a great business there.

I suspect you need three or four types of advice.

A business broker will be able to assist you in finding a valuation for the business – call a few and ask lots of questions, then compare notes.

Do some independent research on the internet around valuations.

A commercial real estate broker will be able to advise you of market conditions for the factory including lease amount and length of lease etc

A lawyer specialising in commercial real estate will be able to advise around special conditions of the lease, but you may find that the real estate agent is able to provide sound advice here too.

An Accountant can give you some advice around tax planning which given that the laws can be nuanced in this area, could mean a lot of $$$ for you now and in years to come.

Please come back and let us know how you go.

Cheers

[norm1981]

accountant said
could be 5 mil

But highly doubt it
and dont take less then 3

I just dont see how it could be this much

[James Millar]

norm1981, post: 269841, member: 117914 wrote:

accountant said
could be 5 mil

But highly doubt it
and dont take less then 3

I just dont see how it could be this much

How did they draw that conclusion?

Helping build better businesses and better lives with expert financial and taxation advice. info@360partners.com.au www.360partners.com.au 03 9005 4900

[Paul – FS Concierge]

norm1981, post: 269841, member: 117914 wrote:

accountant said
could be 5 mil

I believe you would get better advice if you contacted a number of Business Brokers, especially any that had recently sold businesses in your industry, near your location.

[Dave Gillen – FS Concierge]

JamesMillar, post: 269842, member: 5318 wrote:

How did they draw that conclusion?

[USER=117914]@norm1981[/USER] as James has hinted, it’s important not just to get a valuation, but to understand how it’s been calculated. That way you can explain the value to the buyer – because it’s only worth that amount if the buyer agrees with you.

Dave

Dave Gillen - Client Acquisition | Brisbane | (07) 3180 0288

[Stevenung]

norm1981, post: 269841, member: 117914 wrote:

accountant said
could be 5 mil

But highly doubt it
and dont take less then 3

I just dont see how it could be this much

Lol, you were right to doubt your accountant. That’s an outrageous valuation at 5mil. At 400k per annum profit, 5mil will be over a 10x multiple – publicly listed companies aren’t getting this.

The valuation is going to be based on a number of factors including the type of industry you are in, how easy is it to run your business, competition, risk, what similar businesses are selling for, how much of the goodwill is attached to you etc and of course the financials are important too.

Feel free to send me a message.

Steven Ung
Business Broker
0427 978 477

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