Talking Law

We’re bringing back on the show Kerry Boulton, the CEO and founder of The Exit Strategy Group, to talk about the pros and cons of eight different types of business exit channels.

Ben Walker, the founder and CEO of the accounting firm Inspire, joins us on this episode to talk to us about the key differences between the 3 main categories for business structures - sole trader, company and trust.

Download AudioSubscribe on Apple PodcastsSubscribe on Google Podcasts

Ben Walker, the founder and CEO of the accounting firm Inspire, joins us on this episode to talk to us about the key differences between the 3 main categories for business structures - sole trader, company and trust.

* Speak to a lawyer about an issue you are facing now

* Leave us a message with a legal issue that you want us to cover on the podcast

Episode Highlights:

* Ben’s life mission

* Cashed Up: 7 steps to pull more money, time 
and happiness out of 
your business by Ben Walker & Harvee Pene

* Reasons why organisations pay more tax than they need to

* 3 main categories of business structures

* 3 differences between each type of structure

* Sole Trader Structure

* Company Structure

* Trust Structure

* A New Innovative Product

* Income Perspective – Company vs Trust

* Sale of the business vs sale of the shares

* Capital Gain – Company vs Trust

* Business Sale Perspective – Company vs. Trust

* Watch out for part 2!

Ben’s life mission:

To inspire others to create a business that gives them the freedom to put family first and to make a positive difference in the world

A lot of business owners get into business because they want freedom of time or money usually to give back to their families. - Ben Walker

I recall a few years ago looking at some ABS statistics that talked about the owners of small businesses. When compared to the number of hours that they were putting in, they were actually earning less than the minimum wage. - Joanna Oakey

Cashed Up: 7 steps to pull more money, time 
and happiness out of 
your business by Ben Walker & Harvee Pene (Click here to learn more about this book or grab your own copy now!)

We believe in everyone paying their fair share. But what we see is that business owners often pay thousands, if not tens of thousands more tax than they need to be.

The problem is accountants aren't picking up on all of this stuff that they can do to help their clients the most. My personal belief is that's because accountants are usually focused on billing hours and that's how they make money.

- Ben Walker

Reasons why organisations pay more tax than they need to:

* Poor business structures

* Small business tax concessions not being used

* Accountant is not asking the right questions to clients

We actually have a list of 56 strategies that we use to save tax. And so for every client, before we finish their tax returns, we run those scenarios past each job. - Ben Walker

3 main categories of business structures

* Sole trader

* Company

* Trust

3 differences between each type of structure

* Tax rate

* Ability to plan for tax

* Asset protection

Sole Trader Structure

* You can pay up to 47% tax

Joining us for this episode is Martin Lo Surdo of Amplify Business. In this episode, we talk about Martin’s history as a business owner, and draw insights from his experience in growing and selling a niche business.

Martin Lo Surdo of Amplify Business introduces us to the fascinating world of franchising! In this episode, Martin walks us through the basics of the franchise business model and talk about the sorts of questions that both potential franchisors and franchisees might be thinking about.

Martin Lo Surdo of Amplify Business introduces us to the fascinating world of franchising! In this episode, Martin walks us through the basics of the franchise business model and talk about the sorts of questions that both potential franchisors and franchisees might be thinking about.

* Speak to a lawyer about an issue you are facing now

* Leave us a message with a legal issue that you want us to cover on the podcast

Episode Highlights:

* Getting into Franchising

* The Franchise Business Model

* 3 Reasons for becoming a franchisor

* To be a franchisor, your business must be

* 3 Tips for potential franchisors

* 4 Reasons for becoming a franchisee

* Limitations of franchising

* 2 Tips for potential franchisees

* Franchising in media

* How to contact Martin

Getting into Franchising

This friend of mine said, “I think I might have something for you.” He was working for a prominent franchisor at the time and a national marketing manager. He thought I was really well positioned to interview new franchisee applicants coming through, wanting to take on a franchise.

So my initial foray was interviewing people as a selection manager for people wanting to join into a franchise business.

– Martin Lo Surdo

 

The Franchise Business Model

There are many franchise businesses that sell franchises and the better businesses grant franchises. That is a real distinct difference.

Business buyers want to know what they're getting themselves into so what’s really important is actually presenting the facts of the business, presenting the systems.

If I look back at my career, one common thread is small business and my enjoyment in being involved in small business and the role that small business plays in the local community. I really enjoy what small businesses can do it really. They obviously start small but they don't envision to always be small.

The franchise business is a good way of getting people into business and fulfilling their career goals by business ownership.

– Martin Lo Surdo

Reasons for becoming a franchisor:

* Reach a wider audience - using franchising as a distribution model

* Have access to funding - where the franchisee acts like a commercial partner

* Change in interest - for the business owner who wants a change in his role in the business

To be a franchisor, your business must be:

* Profitable

* Able to be replicated

* Have well-established systems

 

Tips for potential franchisors:

* Get a good lawyer because there's a whole lot of legal compliance around franchising.

* Talk to an experienced franchise consultant to get some guidance and advice.

* Have your brand protection in place because failing to do so can have all so...

To close our series with Sam, let’s talk about the joys of coming full circle in the business cycle. We ask Sam about his post-sale reflections and what retirement life is like for him.

In this episode, Sam talks about some of the fundamentals that we hear again and again and again. The importance of looking at your business from a buyer's perspective and the importance of selling the business at the right time when it's got strong value and still has value to give into the future.

We’re excited to have on the show Greg Savage of The Savage Truth – who brings to us a wealth of experience in building businesses, having taken just one of his businesses from start up to $60 million.

We’re excited to have on the show Greg Savage of The Savage Truth – who brings to us a wealth of experience in building businesses, having taken just one of his businesses from start up to $60 million.

* Speak to a lawyer about an issue you are facing now

* Leave us a message with a legal issue that you want us to cover on the podcast

Episode Highlights:

* Greg’s First Business – From Start Up to $60-Million

* Key Elements to Growth

* Surviving the 1990 Australian Recession

* Leadership, People Management and Coaching

* From Recovery to Public Listing

* Listing is Not the End, It’s the Beginning

* The Savage Truth

Greg’s First Business - From Start Up to $60-Million

Eighty percent of recruitment companies globally have less than 10 people. So to start with nine was ambitious and we did. It was scary. I mean we paid ourselves a lot less than we had to pay our staff and all those sorts of things. But we didn't acquire a business.

We did acquire was some very good skills of people and some relationships that they had and they all had relationships with us because we had worked together before and so we were able to get momentum very quickly which we needed because we needed cashflow obviously.

- Greg Savage

Key Elements to Growth

The three partners, we each had very different skills... That was actually very important to help us grow. We weren't treading on each other's toes. We had a healthy respect for what each other did.

Secondly, we treated our business like it was a big business long before it was a big business.

I think we were quite brave. Maybe brave, maybe stupid but a bit of both, which allowed us to open offices in other cities. We had a very strong ethos and culture.

- Greg Savage

Surviving the 1990 Australian Recession

We honestly survived for three reasons.

* 1. We had no debt. I am a big fan of minimal debt, or if you've got debt, it's strategic.

Never get yourself into a position that if your revenues dropped by 50 percent, suddenly the bank owns you.

* 2. We had a strong temporary and contract business.

This is very important for any business because there will be people listening to us who are not in recruitment. It doesn't matter. The lesson is you've got annuity revenue.

* 3. We cut our cost by more than 50 percent.

This was all due to the partner who had the finance knowledge. What we did on his prompting was we cut deep fast. As a result we traded at a break even for two years, which doesn't sound much. But it was a break even, whereas 60 percent of our colleagues went bust.

Leadership, People Management and Coaching

Leadership is something that can be learnt. You can get better at leadership.

Retention of staff isn’t about paying people more or putting in a billiards table.