You Are About to Learn The "Secret Ingredient"

To Create Wealth And Lifestyle With Business...

We have put this Blueprint together to show you how to take advantage of the incredible opportunities in the business market that are available right now. On this page we will guide you through the steps that will allow you to create fantastic cash-flow and wealth from buying and selling business while still enjoying a great lifestyle.

Read closely now...

First and most importantly, we are going to reveal the Secret Ingredient to creating massive wealth in business. This is what makes the difference between slogging along in a business or job that's going nowhere, and creating wealth and freedom for yourself and your family.

As you know, we have bought and sold businesses for profit, and have also been involved in hundreds of business sales through brokering. We now advise multi-millionaires in buying and selling business and have created our “How To Buy And Sell A Business” System from our extensive experience and expertise in this area.

But all this will be worthless to you,

unless you understand one important thing...

When we began working so closely with high net worth business-owners and investors, we discovered that they do things differently. They use business in a different way to most people.

Once we recognised this "Secret Ingredient" and applied it, the money just started to flow. And to create true wealth in business, you need to know how to do the same.

To explain it, we'd like to use the famous diagram from Robert Kiyosaki's book “The Cashflow Quadrant”:

On the LEFT side of the quadrant are the WORKERS. These are the Employees (E) and the Self-Employed (S) who must exchange time for money, they MUST WORK to get paid. This includes anyone who runs a business but must work in it every day to keep it going. We find these people generally have to swap time for money, so the potential for growth and lifestyle is limited.

This is where it's easy to become trapped, and where you will find it very difficult to ever move ahead and create the true wealth and freedom that you deserve.

This group represents about 80% of the worlds population, but possesses only 5% of the wealth.

On the RIGHT side of the quadrant are the BUSINESS OWNERS (B) and INVESTORS (I). For this diagram, a Business Owner is someone who owns a business, but does not have to work in it every day – they use staff, systems or automation to leverage their time and money. The Investors use business as cash-flow generators and have their money work for them.

This group represents about 20% of the worlds population, but possesses 95% of the wealth.

Are you on the Rich side or the Poor side?

If you are already in business you may be beginning to rethink your strategy, and if you aren't in business you may be wondering how you can get onto that right-hand side!

The “How To Buy And Sell A Business” system is about being an INVESTOR in business and using the massive cashflow and leverage of a business to create more wealth, faster.

And the key knowledge you need to be able to do this is to understand where the VALUE lies in your business asset. We have found that most small business owners have no idea where the value is in their business, so they don't know how to increase it effectively.

On the other hand, we notice that ALL our millionaire clients treat business as an asset – one that can be improved, added to and traded, and they all know exactly where the value is in each business they get involved in.

So how do you move over to the Rich side?

The “How To Buy And Sell A Business” system is designed to guide you through the transition into a true Business owner and Investor, to help you find a business that can return you many times your investment.

It is designed to help you find and buy a business that will not enslave you into the time-for-money trap. Or to help you transform your existing business, free up your time and then sell it for a profit when you are ready to.

This program shows you how to create a highly valuable business ASSET and understand the VALUE of that asset.

You're about to discover inside secrets to valuation so you'll never get caught overpaying, you'll learn how to leverage your money by buying smart, and we'll show you how to easily add value to a business, just like the wealthy do.

What if I don't have much money – can I still get into business??

You could be a single mum, a shift worker, a corporate executive or an overworked business-owner. It doesn't matter where you start from, there are ways that you can get started in business, even with very little money, very little time and very little risk. In fact most of our wealthy clients started small, just like us.

It's all about taking action, and knowing what action to take! Have a look at these examples of businesses that have been bought and sold:

Let us show you the easy way to start...

In the next pages we're going to show you how you can get started in Buying and Selling Business. You are going to learn:

• Powerful inside secrets to valuation
• How to add value quickly and easily
• How to leverage your time and money, so you get more time and money!
• How to set-up your business for maximum sale price right from Day One (or keep it as a cash-cow)

We want to you to start thinking about business just like you would an investment property. You are looking for one with potential to renovate, you put down as little money as possible to take control of it, you renovate the areas that add the most value, and you plan for it's sale right from day one, so when you want your money it can be sold at a great price.

UNDERSTANDING VALUE

The most important place to start is understanding VALUE as this is essential for your success.

The “How To Buy And Sell A Business” system relies on knowing how to assess and increase VALUE in a business. It was only after seeing hundreds of business sales and working with many high net worth buyers that we realised ther are Two Essential Keys to Valuation:

KEY #1 – KNOWING HOW TO VALUE A BUSINESS

Why is this so important? Imagine not understanding how properties are valued and trying to make money from real-estate investing.

It is incredible how many business owners don't know how to do this – in fact many accountants don't know either. And it is the crux of the most costly and most common mistake made in business by both buyers and sellers.

The Number One mistake made by business buyers?

Overpaying. One of our friends recently told us the sad story of a girl who bought her dream cafe for $130,000. It turns out it was actually only worth eeek! $20,000.

That's $110,000 she couldn't afford to lose.

What a horrible and expensive mistake, so easily avoided if she has the knowledge you are about to learn.

The Top 2 mistakes made by business sellers?

Pricing too high – which means buyers ignore it and it sits on the market and doesn't sell. The longer it sits on the market the more nervous customers and suppliers become, the more the competition will know about it, the more frustrating it is for the owner, and the more it goes stale and won't sell. So when the price is finally reduced, the seller just looks desperate.

Pricing too low - because the owner doesn't see the value in their business. In fact, many business owners literally walk away from hundreds of thousands of dollars because they don't realise their business has value and could be sold.

Sound unbelievable? Have a look at this short segment from one of our How To Buy And Sell A Business Workshops:

The “Back of a Napkin” Guide To Valuing A Business

- Surprisingly Accurate and Simple!

We're about to show you the technique used by every business broker and savvy business investor to roughly value a business, or immediately recognise if a business is over-priced. You would be amazed at how many multi-million dollar deals are valued on the “back of a napkin” this way!

This simple but powerful technique can save you making the hundred thousand dollar mistake that the girl in the example above made – imagine how much this could save you too...

First you need to understand that business valuations are generally based on Return On Investment (ROI). When you put money into a business it's just like investing in shares or property - you want to see a return on that money.

If you were to put your money into the bank, you would expect to get around a 7% return in the current market with zero risk and zero effort – so this is your baseline.

It is generally accepted that an investment into a business should get at least a 30% return. For example, if a business costs $300,000, it should make at least $100,000 in net profit back each year.

When a broker does a valuation, they will work this equation the other way around and use a “Profit Multiplier”. So a good small business that has a net profit of $100,000 should sell from 1-3 times that figure, anywhere between $100,000 and $300,000. Anything over $300,000 in the current market and you are OVERPAYING based on our strategy.

In any business you are looking to buy, quickly check the valuation by working out the “Profit Multiplier”. Just divide the asking price by the net profit.

Remember! Our system is about buying well. Just like in property - you make your money when you buy.

So if the Profit Multiplier is higher than 3, then beware! The business is probably overpriced based on our strategy, and you will want to see that the seller is negotiable before you proceed any further.

This is exactly how we initially value a business, as do all our rich clients and friends. Now be aware that there is an “ART” to getting this as accurate as we would, there are clearly many factors involved that we can't cover in detail here. The main point we want you to get is how to avoid overpaying in a quick and simple way – just remember your Return On Investment!

So how come some big businesses showing NO profit sell for millions of dollars?

And why do some businesses sell on a 1x multiplier, and others on 3x?

KEY #2 – THE 5 AREAS OF VALUE

Remember we said that all wealthy business owners know exactly where the value lies in their business? By understanding this, they know exactly where to focus their efforts to give the biggest “bang for their buck”.

And this is the key to understanding why some businesses sell for double, triple or up to 25 times more than others. They are strong in these specific areas, which makes buyers want to pay more for them.

You can increase the Profit Multiplier that a buyer is willing to pay by improving the 5 Areas of Value

The wealthy get rich by ADDING VALUE to their assets. Now we're going to show you exactly where to find the value in a business so you can do this too.

THE 5 AREAS OF VALUE in a BUSINESS

1. LIST

The customer list, or database of a business is it's lifeblood, so of course this is an area of great value. But it is the QUALITY of a list that increases value more than just the size.

Many businesses have no list recorded at all – especially retail shops and other high traffic businesses. There is enormous potential to quickly increase sales and value in any of these businesses.

For example – we went into a small cafe recently and they asked me to become a VIP customer and go into the draw to win a mobile phone, in exchange for my name and phone number. A few weeks later it was Mother's Day, and I got a nice message letting me know that they were open for Mother's Day and they had a special mother's day treat for me. Guess where we went for Mother's Day and spent $45??

That business is building a valuable list and a valuable relationship with their list. Not only is it increasing their profits now, but when they come to sell, a buyer may be willing to pay a higher multiple of the profit because of the value of that strong list and relationship.

The second point is that many businesses that already have a list aren't using it.

It has been shown that it is up to 8 times more expensive to acquire a new client than it is to sell to an existing client.

This means that if you can find a business that has an existing list, but is it not taking advantage of it – you have a business that has potential to increase profits and value very quickly. This is because it is far easier and more cost effective to work the existing list rather than the 8 times more expensive practice of chasing new clients (which is where most business owners think they need to focus).

These opportunities are everywhere. Believe it or not there are even big blue-chip companies with golden databases of clients that are under-utilised.

Let's take Harvey Norman for example. They gather every detail from anyone who uses finance to purchase something from their store. Their list must be HUGE! But I have never received a letter, phone call, message or email asking if I would like a matching coffee table to go with the TV cabinet I bought there...and I would probably say “yes” if they just asked.

So the wealthy look for opportunities for adding value to the LIST of a business – they look for:

• Businesses that are not making the most of their list, or ones where they could quickly and easily capture a list.
• Businesses that have customers that are easy and cheap to find – this makes building the list faster, easier and more cost effective.
• Opportunities to maximise the value of a list by offering other related products or services, or using incentive programs and offers to get customers to buy more often.
• The spread of the list – there shouldn't just be one or two customers accounting for most of the turnover – the value increases the more spread there is in the list.
• Businesses that are not using the potential of the internet and a website for building a list, making sales and getting new customers.

2. SYSTEMS

Systems are highly prized and valuable because they are what frees the owner from the business and gives them back lifestyle – remember the right-hand side of the quadrant? Systems are what allow you to be a true Business Owner and Investor.

Buyers and Investors will pay handsomely for a highly performing system because a well-systemised business will not only produce consistent and reliable results, it will deliver those results with the least amount of effort from the owner.

The more systemised the business, the more valuable it is. Franchises are a great example – they are sold for 3-5 times multiples of profit and even fetch hundreds of thousands of dollars when they are brand new and showing no profit. This is mostly because of their strong systems.

Wealthy buyers look for businesses where they can systemise or automate processes such as:

• Getting new customers
• The delivery of the product or service
• Customer follow-up and relationship building
• Handling common problems
• Running staff

Many of these are easily achieved in small businesses at a fraction of the traditional costs by using resources and automated software available online.

Broker's Inside Tip: We have found that the most keenly sought after and highly valued businesses are those that require very little time from the owner to run. When you are looking for a business to renovate, the best choice will be one that has the potential to run on “autopilot” (if it doesn't already).

3. PROPERTY

The property from which a business operates is a vital part of it's value and success, especially for retail businesses that rely on passing traffic. The classic example is McDonald's – when Ray Kroc was asked what business he was in, he didn't say “burgers”or “food”, he said “real estate”.

You can use the cash-flow of a business to create a valuable asset by buying the commercial property of the business - all our wealthiest clients have done this to reach their multi-million dollar net worth in such a short space of time.

Consider this example, if two business owners made the same net profit of $50,000 a year over 20 years of owning a business, but one paid rent of $30,000 a year and the other invested that $30,000 into buying the business property this would be the result:

Business A: $1 million net profit, $600,000 paid in rent, no assets

Business B: $1 million net profit, $600,000 paid on buying property now worth around $1.2million

When looking for a business to buy, the wealthy look for ways that the value of the business property can be quickly and easily increased:

• Physical renovation – just like on a house
• Lease renegotiation
• An option to buy
• Website “property” such as domain names, web-sites, links, page rank and position on search engines for relevant search enquiries.

4. BRAND

The wealthy look for strength in brand – that is the public perception of the business. There is value in a brand because it reduces the risk of the business, and it can increase the profit multiplier significantly. Again, take franchises as an example, where the value of the brand and systems means that a well-known retail franchise can sell for up to 6x net profit, and over $1 million for a new store with zero profit.

However a brand can be fickle – it only takes one negative event or piece of bad publicity to dent reputation and reduce it's value. The brand value can be reinforced by strengthening the businesses relationship with it's LIST.

We suggest that this is not one of the areas that you would focus on when buying and selling a business, but it is worth being aware that it's an area of a business that can affect valuation.

5. INTELLECTUAL PROPERTY

The intellectual property of a business relates to the unique aspects of the business. This may be a unique product or service, a specialised design or a unique system. These things may be protected with patents or trade marks, or they may be hard to replicate because of the time, research or money required to develop them.

These qualities increase value by making a business more competition proof. The more unique and protected the intellectual property, the lower the competition, so the more valuable the business is.

In larger businesses, a great deal of money may be spent developing Intellectual Property (take Pharmaceutical Companies for example), in smaller businesses and online business you can increase value by developing unique ways of providing your service or creating small software programs that are unique to your industry or niche.

One example is a building company we knew that developed a software program for quoting jobs. They were bought out for multi-millions by a big publicly-listed company who wanted to own and use the program.

SUMMARY OF VALUE

Now you know the keys to adding VALUE to a business - the stronger the 5 Areas of Value, the higher the profit multiplier it can be sold on. However, renovating the 5 Areas of Value is only part of the story. There are many other tips and tricks to getting a higher price for your business.

We have developed a “12 Point Holy Grail” Checklist that lists all the elements of the most highly valued business we have ever seen. You'll find it in our mentoring program which you can learn more about by clicking here.

HOW TO BUY AND SELL A BUSINESS

So how do you actually buy, renovate and sell a business for profit? And how do you get started if you don't have a lot of time, or money? Here are some first steps and tips to get you started...

BUYING A BUSINESS

The first question we are often asked is why buy a business – why not start one up? There are four reasons why buying is a far better business decision:

TIME

Your time is limited - not only the amount of time you have each day, but also the amount of time you have on this planet. If you want to be able to “retire” and enjoy life, then you need to create your wealth as fast as possible and ideally still enjoy time along the way.

When you buy a business, you're not just buying all the equipment and setup and database, you are also buying all the time and effort that the original owner spent getting it going. Generally a new business doesn't turn a profit for at least the first year, usually the first 2 years – so if you work out what that is really worth in your time it's probably hundreds of thousands of dollars, and are you prepared to wait??

CASHFLOW

You get instant cashflow, instant customers and (usually) instant profit in the business. Customers are already walking in the door giving you money, and you can plan ahead based on that existing cashflow.

HISTORY & MOMENTUM

The longer a business runs, the more momentum it builds, which generally means it can recover from mistakes more easily than a new business. You also have a proven system that works, where a new business is untested. You also have historical data that you can do due diligence on, further reducing your risk.

THE DISCOUNT

You'll often be paying cents in the dollar to what it actually cost to set the business up – stationery, equipment, leases, suppliers, getting customers, and you might even get it all free – there are plenty of people out there who are willing to just walk away from their businesses as you saw in the video above. Sometimes if you are willing to take over the business or the lease, they may be happy to just walk away.

THE 5 GOLDEN RULES OF BUYING A BUSINESS

We have developed 5 Golden Rules for buying a business that will:

• keep you safe from the costly mistakes that most buyers make
• get you into a great business that has potential
• avoid businesses that will trap you or get you nowhere
• quickly grow in value with our simple and easy to apply techniques
• get top dollar when you decide to sell

THE FIRST GOLDEN RULE: The business must be able to be RENOVATED

That means you must think like a wealthy investor and look at the business like you would look at a property you were going to invest in. Where can you ADD VALUE?

Is there potential to improve at least one of the 5 Areas of Value quickly and easily?

• Can you build a list quickly and cost effectively?
• Can you leverage the list?
• Can the systems be improved?
• Can you renovate the property?Or renegotiate the lease?
• Is there a strong brand?
• Can you do something unique in the business, or does it already have good IP?

Just this rule alone will get you looking at the right kind of businesses. It doesn't matter what size or industry, you just need to know that you can add value. Remember, you are building a highly valuable ASSET by adding value.

WHERE TO FIND BUSINESS FOR SALE

The best business bargains aren't always listed for sale, but these listings are a great place to start.

Inside Tip! For the most negotiable businesses, look in the “for sale by owner” listings on the following websites:

• www.business-trader.com.au
• www.businessforsale.com.au
• www.noagentproperty.com.au
• www.seekcommercial.com.au
• www.realcommercial.com.au
• www.business2sell.com.au

What if you don't have much money to start?

Don't worry! There are many options for getting into business without spending a lot of money.One great strategy is to start online – this is also great if you don't have a lot of time available to start with.

A website is like a little mini-business and you can get started with less than $1,000, you can even buy them for under $100! The biggest online market for buying and selling websites is www.flippa.com, take a look to see the wide range of sites that are for sale.

KEY POINT! The principles for buying and selling websites are the same – you are looking for sites where you can ADD VALUE.

Some opportunities to look for:

• Sites with lots of traffic but no list
• Sites with lots of traffic but no monetisation (nothing for sale or no advertising)
• Sites with a database and no monetisation (products for sale or advertising)
• Sites with some profits but have very little traffic (that you could increase or add your own customer base into)
• Sites with a list or traffic that is relevant to your existing business (you can buy up traffic!)

BUYING NO MONEY DOWN

Wealthy business buyers use as little of their own money as possible to take control of a business. They want to get the highest LEVERAGE possible and there are many creative ways to do this.

The most common is Vendor Finance. This is where the seller funds you into the business by allowing you to pay off the purchase price over time. You can even arrange this so the payments come from the profits of the business – so you don't have to use any of your own money. And if the seller is desperate enough, you may not have to pay anything up front to take over the business.

Remember the video above of the people walking away from their businesses? This is more common than you think and a great way to get into a business with no money down. There are many other creative ways to get into business without using your own money, in fact we show step-by-step detail of over 20 options in our mentoring program!

RENOVATING A BUSINESS

Let's look at an example of a small business and see the potential of this process!

This business is turning over around $100,000 and making a net profit of $20,000. It is not well systemised, they don't have a customer list at all and they have no other assets with the business.

So if we apply our valuation rules, it would be valued at around $20,000.

Now let's RENOVATE!

We'll focus on the top three areas of value, which are the List, Systems and Property of the business, and see what effect it could have on the numbers and valuation.

In the example below, COG = Cost of Goods Sold GP = Gross Profit Before Renovation:

After building the List and selling more products to new and existing customers, sales increase but Cost of Goods sold remains the same and Expenses increase slightly, but the profit has increased and we could possibly apply a higher multiplier because there is now a LIST:

After leveraging the list and selling more to existing customers, and introducing some web-based product that have better margins, lets say the sales remain stable (less sales to new customers but more sales to old customers), the profit margins increase and there is now a nice automated online system for making sales:

After improving systems so paying less for staff, or using automated systems to free up time and staff, and introducing systems to automatically build a relationship with customers and offer them other products, and renegotiating the lease so expenses are reduced, you now have a nicely systemised business with a good list that not only has a higher net profit, but would probably sell on a higher multiple because it is so easy to run.

The value is now potentially 15 times the original buy price, even though the profit is only 5 times greater!

Please note: This is an illustration only, to show you the potential effect of applying everything we have covered so far in this Blueprint. It is designed to show how small and simple changes can significantly affect the value and profit of a business.

SELLING A BUSINESS

As you have discovered, one of the most important things you should think about when buying or getting into a business, is how you are going to get out. There are many tricks to selling a business for a big profit.

This is what we have been doing professionally for the last 5 years, and we are able to get our clients significantly more money for their business using our knowledge and skills.

The most essential thing is that your business is properly prepared for sale – this is where we see sellers make their most costly mistakes – we have seen literally $$ millions left on the table because the business was poorly prepared.

There are many ways of selling a business and by having the knowledge that we are about to reveal, you can potentially make thousands up to millions of dollars more in the sale of your business. The most common way of getting out of a business is to “sell” it, but that doesn't necessarily mean that you need to put it on the open market and have it purchased in the traditional sense.

THE 3 SECRETS TO A BIG SALE PRICE

Now we will reveal the three most effective ways to sell your business for hundreds of thousands or millions more than you could in a standard sale.

If you have big goals and the drive to create massive wealth in your lifetime, then these are three options you need to know more about.

Vendor Finance

Do you have a business that you are struggling to sell? Or do you want to get the highest possible price for your business?

Then vendor finance is a great option. Basically you help fund a buyer into your business by allowing them to pay off part or all of the purchase price over a set time. This means they don't have to go to the bank for finance and they can pay you out of the profits of the business.

This means you'll have more buyers for your business, and they will be willing to pay more for ability to get into a business for less money up-front. Vendor finance is very common in the US and is becoming more popular here in Australia.

Franchising or Licensing

Franchising is an exciting and massively leveraged way to sell your business. Many millionaires have been made through franchising because it allows you to sell your business over and over again.

If you want to use this model, choose a business that has the potential to be well systemised and with the potential to repeat the model in many geographic locations. Food, retail and home based businesses work best.

Big Buy-Outs

If you have a big vision and would like to be paid more than the standard 1-3 times net profit for your business, you need to target the buyers who place more value on your List, Systems and Brand than they do on just the Profit of the business.

Large businesses need to keep growing, especially ones listed on the stock exchange that need to show increasing profits for shareholders. Often the easiest way to grow is to buy out another business in the industry.

Many small Private Equity firms have funds that must be invested in local Australian businesses, we know of several who currently have around $30 million that they need to spend.

High net-worth private investors also have money to invest in business. They are usually serial entrepreneurs and they are looking for businesses that they can invest in and take to the next level. They bring experience and connections as well as funds, and can help you realise big goals for your business.

Another Inside Secret: "Deal-Spotting"

(or how to make great money without buying the business)

There is a desperate need at the moment for good businesses. There are literally billions of dollars waiting to be invested, and many businesses, investment funds and wealthy individuals want to invest their money into buying a good business.

But they don't have the time or resources to find them.

If you know how to find a business with potential that suits their criteria, they are more than happy to pay you handsomely for your time and skill. We have been paid sums of more than $25,000 just for introducing a wealthy investor to a good business for sale.

“Deal-Spotting” is an absolute goldmine! Plus if you are keen to be part of the deal, and you show potential, it is common for wealthy investors to fund people into a good business. So if you already have some business skills and are keen to grow and start making the big bucks, you can potentially part-own any sized business you want. And to start, all you need to do is begin talking with these wealthy buyers and looking at the kind of businesses they want. You know how and where to find businesses with potential, now you just need to find your wealthy buyers.

Personally, we have found them in the following ways:

• attending seminars, conferences and functions
• networking and business groups
• through friends and business contacts
• industry trade shows
• advertising and internet marketing
• directly contacting potential buyers and sellers

Would you like some help to achieve all this?

The “How To Buy And Sell A Business” system is about being an INVESTOR in business and using the massive cashflow and leverage of a business to create more wealth, faster.

Our mentoring program is designed to guide you through the transition into a true Business owner and Investor, to help you find a business that can return you many times your investment.

It is designed to help you find and buy a business that will not enslave you into the time-for-money trap. Or to help you transform your existing business, free up your time and then sell it for a profit when you are ready to.

If you would like to get all the inside knowledge about Buying And Selling A Business for profit, and get on-going support as you apply this strategy, then we can help.

For only $97 per month you can get access to our mentoring program to guide you in detail, every step of the way.

To find out more about what the mentoring program covers, please click here.

It doesn't matter whether you are in business now, or you've never been in business before, this program will help you move over to the rich side of the quadrant and use business to create the wealth and lifestyle you deserve!

Kind Regards,

Matt and Liz Raad