It’s Never too Soon to Start Planning for a Successful Exit

By Carl Wilkin CFP, MBA, AAICD
National Practice Adviser
MLC Advice Partnerships

Invest in diversity and longevity

One way to position your business positively to successors is to have a good spread of services and generations covered in your client base. Having diversity in your book sends a message to buyers that they’re investing in a business that won’t lose revenue as clients’ age or their needs change. A broad range of services informs buyers that your business is advice and client outcome focused.

By seizing the opportunity to offer intergenerational wealth advice, you’ll also be creating a pipeline of younger clients. They’ll have different planning needs and an appetite for different products too. With a broader demographic and service profile to your book, you’ll have a wider range of buyers interested in your business as well as a better baseline for its market value.

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Don’t underestimate the value of solid foundations

There are lots of things beyond your control that can affect the final sale price of your business - from regulatory changes to the current economic landscape. But there are other ways to give your business an enduring edge.

Having administration, compliance and customer relationship management (CRM) systems in order is a great selling point for any potential buyer. When it comes to accessing client information, no-one wants to be faced with a complicated tangle of paperwork. While it might seem like a costly exercise, an investment in technology now can help your business stand-out.

Understand your market value

By knowing how the market values your business as a commercial asset, you’ll get a good understanding of the price you can expect. And by evaluating your current business profile, you’ll discover ways to enhance that value over the months or years before you seal the deal.

A quick glance at headline EBIT (Earnings Before Interest and Tax) figures from your annual accounts gives potential buyers a feel for the operating value of your business. But they’ll also want to determine how sustainable that level of income is and this partly depends on the composition of your client base - ages and locations, type of products and services they take up and how much revenue they deliver.  

Prepare for potential buyers

Selling in a market with multiple interested parties usually drives up the purchase price buyers are willing to pay, so the more attractive you can make your book , the better the final sale price is likely to be. Be sure to prime your network early with key messages on your diverse client base, comprehensive service offering and simple and robust office systems.

Partner with a licensee who has specialist services

With an MLC licensee you get access to a specialist Practice Advisory team who provide support, advice and coaching to the advice businesses in the network on succession, acquisition, high growth strategies and strategic business planning.

MLC also provides access to the Connect for Growth team. Transacting on the open market can be complicated and time consuming, that’s why most buyers and sellers choose to deal directly with MLC. As one of Australia’s most experienced and largest buyers and sellers of client books, we can take away the hassle and manage the entire process for you, so you feel confident knowing that we will get the best possible outcome for you and your business.

To find out more about MLC’s licensee options, visit the MLC website and speak to one of our Business Growth Specialists.

About the author; Carl Wilkin CFP, MBA, AAICD, National Practice Adviser, MLC Advice Partnerships
Carl works with leading Financial Advice, Accounting and Mortgage Broking firms across the country focusing on Succession, Acquisition, High Growth Strategies and Strategic Business Planning. His passion is helping business owners create and capture value. Involved in Financial Advice since 1989, Carl has held various management positions within Banking, Funds Management, Licensees and Private Practice. In his role as Manager, National Practice Management with NAB Wealth, Carl specialises in assisting key businesses within MLC Licensees to reach their growth and value capture aspirations.