Hi,

• “When is a good time to sell?”

   

  The Universal Law of Supply and Demand

   

  Running a business successfully requires an appreciation of the law of supply and demand – how well your product or service sells will largely depend on how it’s priced, who’s buying and what your competition is doing.

   

  Selling a business successfully requires the same understanding.

   

  Over the last 25 years, deregulation, globalisation and technological advancements have changed the way kiwis do business. Many new enterprises have been started over this time and government statistics suggest that there are now around 350,000 small to medium enterprises in New Zealand. The sustained growth and development of these SME’s has been buoyed by an expanding population fuelled by immigration and the so called baby-boom. This in turn has led to unprecedented levels of prosperity and sees business performance and corresponding values as high as we’ve ever experienced.

Right now it’s a seller’s market, with many purchasers chasing a limited number of quality businesses - low supply, high demand.

As the population ages, the baby boomer cycle will be complete, having a profound effect on business dynamics. Many business owners will be retiring, and looking to sell one of their most valued assets, at a time when there is unlikely to be enough new blood to take up the slack. There will be an increased number of businesses on the market and fewer buyers looking to purchase, reversing the previous imbalance and having a negative effect on values.

This will create a buyers’ market - high supply, low demand.

The best time to sell anything is when it’s a sellers’ market.

We are starting to see the first wave of baby boomers move through the cycle into retirement. If you are planning on selling your business over the next 3 – 5 years, you should talk to us now for advice on an appropriate strategy.

To find out more call either Steve Smith or Richie Lowe on 09 630 1600.

Regards,

Steve Smith AREINZ
MANAGING DIRECTOR

This is a unique opportunity to purchase one of New Zealand’s premier Boutique Bed & Breakfast Lodges. Built in 1904 from a Voysey design conceived in England, this classic example of an Arts & Crafts style home is sumptuous and relaxing with extensive native Kauri, Rimu and Totara features and an abundance of leadlight and stained-glass windows. This magnificent home and accommodation features in the Boutique Lodge circuit in New Zealand; one look and you will see why.

“Hadleigh” is perfectly located in a quiet residential area within easy walking distance of Cathedral Square, the Arts Centre, Hagley Park and numerous other attractions offered in the Garden City, Christchurch.

The current owners have sympathetically enhanced this Grade Two Historic Places listed homestead, resulting in guest accommodation of the very highest standard. This is reflected in the numerous awards, accolades and supreme reputation that “Hadleigh” has attained. Five Star Qualmark rating ensures that “Hadleigh” is featured at the top of the “Pure New Zealand” website and is included in an ongoing and exciting overseas marketing campaign.

Asking $1,670,000 Plus GST (If any)

Click here to learn more.

Why the Price of a Business May Vary Widely

• Proven income has a higher perceived value than non-recorded income.

• Regular repeat clientele has a higher perceived value than does one time sales.

• A well spread customer base has a higher perceived value than a customer base that includes one or two customers accounting for the bulk of all sales.

Helpful Hints       

• Most shrewd buyers don’t want your inventory, because they can buy    their own.

• People often compare similar businesses and judge them accordingly.

• You can’t price a business by sitting in an office. (You need to see the actual business).

What you want or what you paid for the business may bear no relationship to the price you may get for it.

When you are talking about smaller businesses with no more than 25 employees, you can probably figure that about three-quarters of the buyers are going to be people looking to purchase and operate their own business and earn (a living) from it.

Your financial records for the last three years or so, along with information concerning your sources and uses of funds, and the value of plant and equipment you own, will be helpful in setting a realistic price. Prospective buyers will also be interested in your competitors, the markets you operate in and local and national industry trends that affect the business.

Warning

No one can be objective about their own business. Engage a business broker to help you establish a price range for your business objectively. If your business is driving you crazy and not making you any money, it’s not very attractive for selling purposes. Be realistic about what you’ll be able to get for it.

Call us at 09 630 1600, toll free on 0800 180 222, visit our website www.abcbusiness.co.nz or email Managing Director Steve Smith (AREINZ) on steves@abcbusiness.co.nz