Exit StrategiesMurray Anderson

EXIT STRATEGIES

•THE PLANNING PROCESS•WHAT VALUE?•HOW TO SELL•WHAT YOU NEED TO DO•THINGS TO WATCH OUT FOR

THE PLANNING PROCESS• You need to PLAN to sell your business• You need to plan WHEN you want to sell your business

•You need to PREPARE your business for Sale• You need to RUN your business PROFITABLY

** 1 to 3 years ahead **

WHAT VALUE?• Multiple of Earnings (Profit)- nothing more, nothing less• Value not (directly) dependent on Assets• The Business must also be ATTRACTIVE

•Good lease •Great physical appearance•Good customer database etc.

HOW TO SELL

• Use a Business Broker• They work for YOU• They know what to do• They know how to prepare, present and defend the Information Memorandum

•Use UFG Corporate• Experienced • Qualified potential buyers

WHAT YOU NEED TO DO

• Maximise Profitability each year for 3 years• Increase Profitability each of the three years• Increase Sales each of the three years• Make the Lease attractive – relocate if necessary

WHAT YOU NEED TO DO• Fix the appearance of the Store – inside and out• Attend to Procedures, Documentation and Filing• Clean up your Accounting Software database• Update Staff Agreements• Tighten up on Debtors Ageing

THINGS TO WATCH OUT FOR…

• Any leased equipment or vehicles have to be paid out prior to sale

• Staff Leave Balances (inc Long Service Leave) have to be paid to the Purchaser

THINGS TO WATCH OUT FOR…

• Allow for:• Brokers Commission (~5.5%)• Legal Fees – yours and the Landlord’s (Lease Assignment)