In The Media

Begin with the end in mind - good strategy takes time.

Business owners that begin early get a better result - every time. A typical business succession and exit will take at least 18 months and normally 3-5 years to get the best results. Succession planning is about getting three things right at the same time - the business needs to be ready for succession or exit, the finances - both the business and the owners/families need to be set up for retirement or for the next stage, and finally the owners (both exiting and entering) need to be ready - retirement is a big change.

New analysis has found that the riskiest component for advisers when putting together a client portfolio or retirement plan is valuing a client’s privately owned business, according to a succession planning firm.

Recent research conducted by Australian business succession and exit planning firm Succession Plus revealed a continuing pattern in that it is “notoriously difficult” for privately owned businesses to be valued, as most financial advisers are not qualified or licensed to do so “through no fault of their own”.

New research has found that the riskiest component for advisers when putting together a client portfolio or retirement plan is valuing a client’s privately owned business.

Analysis conducted by Australian business succession and exit planning firm Succession Plus revealed a pattern in that it is “notoriously difficult” for privately owned businesses to be valued, as most financial advisers are not qualified or licensed to do so “through no fault of their own”.

Handing over your small business to a successor takes considerable time and effort. Here's why you need a succession plan to help you do it.

Small and family businesses have been the backbone of the global economy for decades. In Australia, small and medium-sized enterprises (SMEs) make up about 70 per cent of all businesses – about half a million – and employ about 50 per cent of the workforce.

In August, the House of Representatives Standing Committee on Tax and Revenue tabled its Owning a Share of Your Work: Tax Treatment of Employee Share Schemes report, recommending changes that have key implications for the small businesses considering an Employee Share Ownership Plan (ESOP).

An ESOP is a mechanism to allow employees to own a share of the company they work for. They can be suitable for both private and public companies, large and small.

Small and medium business valuations hit a record high of $1.4 trillion in June before the latest wave of COVID-19 lockdowns hit businesses across Australia, fresh data from Australia’s biggest succession planning advisory firm shows.

New research by Succession Plus found the total value of Australian SMEs was $1.437 trillion at the end of June, or an average of $605,079 per business. And while owners sat on record values for their businesses, many were looking to sell, with listings up 5.86% since the previous quarter.

A local digital platform has expanded to North America.

On Thursday, Australasian business succession and exit planning advisory firm, Succession Plus, confirmed the news and said that the Capitaliz platform will help North American advisers “unlock untapped value for small to medium-sized businesses”.

Capitaliz enables automatic businesses automation, benchmarking and value enhancement guidance for advisers to deliver successful exits for their clients.

A local digital platform has expanded to North America.

On Thursday, Australasian business succession and exit planning advisory firm, Succession Plus, confirmed the news and said that the Capitaliz platform will help North American advisers “unlock untapped value for small to medium-sized businesses”.
Capitaliz enables automatic businesses automation, benchmarking and value enhancement guidance for advisers to deliver successful exits for their clients.

One of the few positives to come out of the COVID-19 pandemic is that the feeling of uncertainty has led people to address setting up or updating their estate plan which otherwise would have fallen into the “I’ll get to it later” basket.

While financial advisers should be discussing estate plans with their clients, they should not forget about their own estate plan either especially if they own their practice.

The House of Representatives Standing Committee on Tax and Revenue has today presented its report titled Owning a Share of Your Work: Tax Treatment of Employee Share Schemes. The Committee’s overarching recommendation is that Employee Share Schemes be treated as capital for the purposes of taxation, and that a tax liability would arise on the disposal of the assets granted, using the current capital gains tax regime. Succession Plus CEO Craig West takes us through it.

Australian lockdowns are likely to send a recovering financial adviser mergers and acquisition (M&A) market into reverse as owners realise the lockdown will negatively impact their business’ valuation.

Firms seeking to put a succession plan in place would benefit from hiring younger advisers who will be at the firm for the long-term.

As many advisers left the industry, this was creating gaps that needed to be filled but there was a lack of suitable advisers available. This meant there were opportunities for younger advisers or graduates who were seeking their first role.