Business Assessment Report
Each client engagement starts with BMA providing a strictly confidential, obligation free assessment of the business.
In the assessment report we will outline in summary form:
- Our observations as to the business position at present;
- Current business performance in a range of Key Result Areas ("KRA");
- Where we believe the business can improve performance in each KRA; and
- How we propose to guide and support the client to achieve these goals.
A business with a clear strategy and a documented plan to guide it towards its strategic aims is more likely to succeed and will navigate growth hurdles more effectively.
Business planning is a dynamic process. The plan adopted at set up or acquisition of the business is not the one it will need later as it deals with growth hurdles and an expanding payroll or when its owners reach the point of "what next".
A primary benefit of effective business planning is to provide a means by which business managers can be accountable to an externally facilitated process.
Because running a business is a very time-consuming process, it is easy to place the need for effective planning and reporting behind operational demands. This is a mistake, the consequences of which can be very costly in the medium to long term.
Maximum value for a business is more likely to be achieved when it is time to sell, if a coordinated business plan has been successfully implemented over time. This reassures potential buyers that business performance is sustainable and there is capacity for further growth.
Business Planning Process
Residential property (block) management businesses either commence business with none or a handful or clients and grow gradually and organically, or they are established out of an acquired or inherited initial management portfolio. In either situation they will reach a point where the business owners are looking to the future and contemplating growth strategies.
BMA provides advice and support to clients during their growth phase, including:
- Acquisition of another business;
- Merger with another business;
- Increasing levels of engagement with builders and property developers;
- Enhancements to service offering; and
- Brand building and marketing strategies to build new business enquiry.
Business consolidation planning delivers real value to BMA clients as they approach the "what next" stage on their businesses journey.
Areas of investigation will include:
- Diversification of services;
- Enhancing existing services and revenue streams;
- Operational efficiency gains; and
- Review of organisational structure.
BMA guides and supports residential property (block) management business owners through the process of selling their business.
BMA will introduce the various structures available for the disposal of a business. It will be important for business owners to obtain advice from their accountants in making this choice.
Deciding on the most suitable option to sell a business will be influenced by a number of factors including:
- The business owners' life plans, financial position, and personal preferences;
- The size and profile of the business;
- The availability of suitable purchasers; and
- General economic conditions.
Options to explore will include:
- Trade Sale - will typically involve seeking expressions of interest from an agreed list of known buyers. The purchase is generally funded by the acquiring party borrowing money against the business asset and perhaps their existing assets. This is a common sale method often referred to as a leveraged buyout.
- Private Sale - is likely to involve a process of engaging with prospective buyers with a similar profile to the exiting business owners. Rather than a sale being made to a competitor, a new owner/operator is found.
- Internal Buy-Out - involves structuring a deal to transfer ownership of the business (often over two or more stages) to one or a number of employees of the business or to remaining business partners.
- Family Transition - will involve an arrangement between family members to facilitate business ownership succession.
Business Preparation & Sale Process
After an initial introductory meeting, BMA will ask for instructions to prepare an assessment of the business. This is an important first step if a business owner is serious about investigating sale options.
The assessment process will involve providing information to BMA after a non-disclosure agreement is exchanged.
We will almost certainly wish to meet at least once following the introduction meeting before providing our report, which will be accompanied by our recommendations and proposals for moving forward.
Business Preparation Plan (BPP)
It is important to take time to properly prepare the business for sale, as this will improve the sale process outcome substantially.
BMA has current expertise in preparing and guiding business owners with the implementation of a BPP.
A well prepared and optimally performing business presented will:
- Achieve a higher than average sale price; and
- Transition smoothly to new ownership with a well-matched buyer; with
- Low impact on employees, clients and business operations.
All parties expressing interest in the business are required to sign a strict nondisclosure agreement prior to any identifying information being provided to them.
BMA will exchange a nondisclosure agreement with the business owners prior to instruction.