Recently, Eden Exchange spoke with Russell McVey who is a coordinator at Business Brokers Network Australia – the largest member network of Licensed Business Brokers and Business Valuers in Australia. Russell discusses what makes a successful business seller, how to position a business for sale and how marketing in the industry has changed over the last few years.
EdenExchange: Thanks for speaking with us Russell. Can you tell us a little bit about your background and career history? What brought you into the field of business sales and advisory work?
Russell McVey: I have had a career of careers. I went from banking through television retail management, public relations for a national retailer, live theatre management, gym management, motel management, food distribution, Internet service provider management to communications management. I also held executive positions in community festivals, ticketing management for the 84 Commonwealth Games and contracts office for live activity at Expo 88. Many of the latter businesses I started and/or owned so I have had real involvement in a wide variety of business activities. With these experiences, I found that I was able to put myself in the seller space and the buyer space and give good advice from either angle to both.
EdenExchange: What areas does BBNA focus on? What markets do you focus on and who is eligible to be in the network?
Russell McVey: Business Brokers Network Australia was started with the premise that business brokers whether working for a large brokerage or franchise really do all the work from finding listings to the final contract themselves. BBNA is based on the premise that business brokers, as they really do all the work, should be entitled to keep 100% of their fees and commissions. Those that become a partner of BBNA are generally long-term professional business brokers that have the industry at heart.
EdenExchange: How do you match a buyer with the right opportunity?
Russell McVey: Many times the fit feels right. I talk to the buyer to find out what he has or is looking for in terms of expenditure, asset base, income, lifestyle, experiences, family life, whether it’s an owner-operator or under management business, preferred location, desires, style of operation and future prospects. From this one can really determine whether the business would suit or not. A number of times I have recommended a business that the owner was not contemplating and they bought it.
EdenExchange: What advice do you have for positioning a business for sale? What’s the key message you tell your clients?
Russell McVey: Is the buyer ready to move on, unless that is the clear goal things become difficult. Many business owners are looking to sell the business when it does not make the required profit or has falling income. This is not a problem as long as the income and expenditure can be explained. So having good financial figures, have installed systems and processes in the business. Unfortunately, only one in twenty businesses have anything like that. Most of the time the desire to sell is a problem caused by the lack of clear planning and management.
EdenExchange: What major industry trends you believe buyers and sellers should be aware of? How has marketing changed in the field?
Russell McVey: Over time various industry segments become hot and cold. The one thing that keeps virtually any business of interest to buyers is a profitable, well-run business that is reasonably priced. Businesses that are hard to sell is virtually any traditional retail business or restaurant.
Marketing has had a major change in the last 5 years, once it was all classified newspapers, to business for sale websites. Nowadays, there is another transition taking place because business for sale websites have not kept pace with the change in technology and the younger generation.
EdenExchange: What advice do you have for a business owner looking to value their business for the first time?
Russell McVey: Be realistic, if you are a seller and set a price for your business, ask yourself that if you did not have the knowledge you have of your business, would you pay your asking price? Friends, accountants, solicitors, are not business valuers. AIBB Certified Business Valuers are, talk to them.
EdenExchange: In your opinion, what are the key factors separating good brokers and advisers from average ones?
Russell McVey: Any business broker that sells a business is often referred to by the seller as a good business broker, alternatively, a business broker that has not sold a business is referred to by the Seller as a bad business broker. A good business broker is one that listens to the sellers and the buyers, does present an accurate picture of the business, does not use puffery or false information and only lists businesses that he feels confident in selling. Honest and providing information in a timely manner.
EdenExchange: What is the best thing about your job, what drives you to do what you do?
Russell McVey: To me, business broking is a job that I don’t need to have a holiday to get away from. It suits my lifestyle and family life, I don’t need to go to work, my work comes with me wherever I go.
The routine is flexible. I love dealing with buyers and sellers especially if they are honest and are willing to take me into their confidence. Working across a wide range of industries keeps your mind active and work life interesting.
EdenExchange: Thank you.
Business Brokers Network Australia is the largest partner network of Licensed Business Brokers and Business Valuers in Australia. Currently, there are 38 Business Brokers across Australia, Tasmania, Victoria, New South Wales, Queensland, Western Australia with over 590 listings.