Honesty, proactivity, industry knowledge and realistic expectations: the four most important requirements for a successful business sale, according to award-winning business brokers Choon Ng and Neill Van Der Walt.
Walking the talk not only secures excellent results for their happy clients but also scored these two Xcllusive Business Sales brokers some much-deserved recognition at awards gala nights. Choon was named Real Estate Institute of Victoria (REIV) Business Broker of the Year, whilst Neill was awarded the Australian Institute of Business Brokers (AIBB) National Rising Star Broker of the Year.
Of course, it’s great to win awards but that’s not what it’s all about for Choon and Neill.
“We are operating in a very challenging market at the moment for business sellers and purchasers, and the award is really a recognition that we are doing something better than others in this demanding environment. I am fortunate to have the support of a strong team at Xcllusive, giving me the confidence that our clients are getting the best possible result when it comes to selling their businesses,” Choon said.
“At a personal level, I am committed to providing my clients with as much certainty as possible when I work with them. This is built on trust that I will do the right thing by them. A foundation of trust is being able to tell the clients what they need to hear not what they want to hear. This is definitely critical as most business owners do not have previous experience with the sale of businesses, and they really need to be guided, encouraged and not distracted throughout the sale process in order to achieve the best outcome.”
Education and Experience
Choon believes there’s a lot more to becoming a successful business broker than people may think. Education and experience are key in his opinion.
“Education and experience definitely helped me be a better business broker. I find it relatively easy to ‘get it’ in terms understanding the businesses my clients have engaged me to sell. This allows me to identify and communicate effectively the value drivers from the perspective for business buyers and sellers. The system-thinking and problem-solving mindset have enabled me to guide my clients in navigating the pathway from the start to completion of the transaction, minimising surprises, resolving issues and achieving the best possible outcome.
“Whilst the majority of business brokers tend to specialise in the sale of small businesses within retail, franchise or hospitality, most do not have the experience across many industries. It is not easy to sell a business if one does not really understand the business or industry. My clients benefit from my broad skills and expertise as I know how to package and sell their businesses. My broad exposures to different industries also allow me to access a greater network and pool of active buyers and investors in the market for my clients.”
Many business owners or business purchasers are selling or buying businesses for the first time and brokers should understand that, said Choon.
“There can be a lot of unfounded fear associated with the process. A business seller or buyer will likely be taking advice from professional advisors such as accountants and solicitors; imagine if we have a business seller with the advisors on one side, and a business buyer with the respective advisors on the other side of a transaction, and both sides are working on getting the best outcome from their own perspective. The process generally leads to a huge level of uncertainty, stress and time wastage before both sides can reach a mutual agreement.
“Therefore, I believe that to get the best results for my client, every step in the process must be attended to in order to minimise surprises. These include:
- Understanding my client’s circumstance and expectation at the stage of the engagement
- Understanding the business, its operation, the industry, the risks, the potential
- Understanding the motivation of an interested party to buy a business
- Encourage communication between all parties so issues are addressed as early as possible
- Keep everyone updated with regular feedback throughout the process
- Managing the process so that both seller and buyer can develop the trust and work together to reach a mutually happy ending
“I do not have any secret, but I believe the magic bullet is to find the most motivated buyer for my client’s business and help the interested buyer to understand the business so that they can buy with confidence,” said Choon.
Honesty is Everything
Neill van der Walt agrees. The biggest buzz for him is making that process as easy and stress-free for his clients as he can and getting them the very best results possible. He feels very strongly that you must be honest and ‘do the right thing’.
“I got involved with business broking after the sale of my last business. I understand the roller-coaster ups and downs buyers and sellers go through. Selling a business is stressful and emotional at the best of times,” said Neill.
“Honesty pays. I see some brokers listing businesses at unrealistic prices and promising the world in order to win the listing. In my opinion, this practice raises unrealistic expectations and is not in the best interest of the client. I believe our analysts provide an all-round service in this regard and work with sellers to achieve realistic expectations.
“Sellers should have realistic expectations about what can reasonably be achieved in the market. Therefore, as brokers, we need to be honest and frank around pricing businesses for the market. A disillusioned seller will get frustrated with the process if their expectations are set at unrealistic levels.”
Proactive and Positive
That’s excellent advice from Neill. What else does he think is important?
“Being proactive and on the ball, I think is the most important. Being knowledgeable about the process is key, too. A broker should be in a position to advise both buyers and sellers of the next steps and how to progress the process.
“I am also a BAS Agent and have advanced experience in XERO and MYOB. This means I can get the reports needed from accounting systems to enable me to gather information for buyers in their quest to learn more about a business.”
Brokering a business is not like selling a house; it requires not only in-depth knowledge of the market but also experience across many other disciplines. Not all brokers have these credentials, so it pays to ask when choosing your broker.
Neill has experience in sales, marketing, finance, accounting and insurance. He also has 20 years’ corporate experience and eight years’ experience running his own business.
“My background is ultimately marketing technical concepts in financial planning, insurance and investment products. In view of this, I understand that things need to be simplified and broken down into easy-to-understand concepts.
“It takes anything between three and six months to sell a business. The timeframe for selling should be communicated upfront and expectations should be set around this.”
Neill believes that Xcllusive Business Sales offers many points of difference from other brokers.
“When going to market, it is crucial to have excellent marketing support, so as many potential buyers as possible see what you’re offering. This gives the seller the best opportunity to have their business looked at. In my opinion, Xcllusive must have the best marketing and system support in Australia. Our database usually yields enquiries in the first week which gives us a head start for our clients in a new listing campaign.”
Stopping Deals from Crashing
Brokers must be on the ball, proactive and prompt in dealing with buyers and must continuously push the process to completion. If the process takes too long, the chances of deals falling through are greater.
“A broker should be highly adaptable to the environment, people and situations. Every business you take to market is vastly different from the next. You deal with questions from accountants, lawyers, family members and friends ‘in the know’, all with various levels of intensity. Combine all of this with emotions, and you understand why you must be sensitive and understanding,” said Neill.
“I am fortunate in that I have a very good understanding of accounting and the full effect across a P & L and B/S. This often leads to many questions I can ask prior to going to market, so I am able to position reasons why things are what they are.”
Talking to Neill, it’s easy to see that he loves what he does and puts his heart and soul into getting the best results for his clients. Isn’t that the type of broker you need on your side?
“I enjoy the diversity of it all. I also enjoy learning about the business models and seeing the effect they have on the bottom line.
National Real Estate awards showcase the best of the property industry and celebrate leading real estate agency practices and professionals. Winning an award is no small feat!
The awards recognise and reward members who have gone that extra mile in pursuit of service, ethics and great results.
REIV President Robyn Waters said the calibre of entries just gets better every year.
“We all know that real estate is a competitive business and the award submissions are testament to the individuals and agencies who demonstrate innovation, determination and passion in securing the best results for their clients,” Ms Waters said.
Despite knowing that he does an unbelievable job for his clients, Choon was still surprised to be named Business Broker of the Year.
“I missed the opportunity to attend the award evening due to a prior interstate business commitment. However, it was a fantastic surprise when I received the news of winning the award that same evening from REIV via email. I must admit I checked the email very carefully as I thought it might be some sort of online scam! It took me until the next day to confirm that it was authentic!”
Article by: Isobel Coleman