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Business battleplan

9 May 2024 networking and insights York

Join us for 55 minutes on 3rd November to understand  how we would work with you and your team to achieve your business goals and ambitions. 


Scale your own business by protecting and growing your clients’ businesses

Aurik business battleplan Joburg 16 February 2024

Date: 9 May 2024 
Time: 5pm for 5.30pm to 6.30pm followed by networking drinks
Venue: Novotel, Fishergate, YO10 4FD YORK

Distinguish your firm as a scale up champion by both protecting your clients against risk and supporting their growth.

Your private business clients have probably invested everything in their business: money, time, energy and sacrifice. They tend to be so focused on running the business, they don’t step back to look out for threats and opportunities.

Join us for an insight and networking session to gain perspectives on three critical issues which any business owner needs to have planned for, and seldom considers until it it’s too late:

  • The 9  growth challenges facing every business
    Gary Baker, CEO Aurik
  • What happens to a business if a shareholder dies?
    Neil Huntington, Director, Huntington Ross
  • The Importance of a Business Power of Attorney
    Maria Beckwith, Founder and Director, Wills @ Home Ltd

Hosts & Presenters:

Gary Baker

Gary brings a set of experiences from legal, to start up, through to the successful sale of his company through an MBO, to help business owners scale and grow towards an exit or to succeed the business to the next generation.

Neil Huntington 

Neil is in his 30th year in financial services, most of that as an Independent Financial Adviser. Latterly with a focus on helping business owners reduce their tax bills, look after their money and protect the things that are important to them. 

Maria Beckwith 

Maria has >37 years’ work experience across Banking, Financial Services and Estate Planning. Maria qualified as a Financial Advisor in 1992 and has a plethora of experience working for large international corporations.

After establishing Wills @ Home in 2009, Maria completed the Society of Trusts and Estate Practitioners (STEP) Advanced Certificate in Will Preparation for England and Wales. Maria’s estate planning knowledge and robust financial background allows her to aid clients in making informed decisions when planning their Wills, Trusts and Lasting Powers of Attorney.


Register here



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Build your business for an Extraordinary Exit with Aurik & STS EV

Join us for 55 minutes on 7 June to understand how to plan and execute a successful succession plan. 

Achieve an Extraordinary Exit with Aurik & STS Capital

STS and Aurik

Build your business to attract strategic buyers

94.6% of businesses started, fail to sell. A weak exit or hard closure of your company robs you of the opportunity to monetize your legacy.

Aurik and STS Capital have partnered to ensure that your business not only achieves a successful exit, but ensures your legacy through a strategic exit. 

Aurik is a business growth platform that works with established business owners & their teams to build their business to deliver growth & capital value. 

STS Capital are the expert guides that enable you to sell strategically to the people that buy strategically.

Join Aurik & STS Capital to understand how this powerful partnership can ensure that your business is built and positioned for an Extraordinary Exit.

Did you know:

1.3% of companies can survive without their founders. Businesses are not bought. They need to be built to be sold.

Leave this session understanding how to implement a single business growth system that:

  1. Resolves the 9 impediments to business growth and value 
  2. Builds in the 5 levers of valuation and exit
  3. Incorporates 4 types of business growth to maximize your company valuation
  4. Achieves maximum financial value by selling strategically to strategic buyers, and helps owners create legacy potential and actualize true potential value.

14th June / Online
11am EST / 4pm BST / 5pm SAST

Register here



 




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Productivity

How productive is your business and why you should lose sleep over it?

Increasing your productivity should be a key focus as a business owner. It means you leave nothing on the table, maximizing your value all the time.

Pavlo discussed the difference between productivity and efficiency, and how to calculate your business’s productivity in this podcast from The Money Show:

Increasing your productivity should be a key focus as a business owner. It means you leave nothing on the table, maximizing your value all the time.

I recently met a manufacturer in the cosmetics and homecare industry. They make creams, ointments, soaps, and the like.

Looking to exit, a valuation of $20m had been offered and they wanted a view.

Their stunning, clean factory glistened with shiny machinery and equipment and a professional team gleamed with pride. The business owner felt that they could do better than the offer. We got to work.

After a day, we discovered that the business was running at 46% of its productive capability. After another day, we learned that the business enjoyed an 87% efficiency indicator.

What does this all mean?

Efficiency is about doing the same with less, while productivity is about doing more with the same. They are miles apart. Closing the productivity gap would add another $15m to the current offer based on the same valuation multiple. What’s best, is that I could be done in just 2 short years. 

How to calculate it?

Productivity measures the gross value added per worker

Productivity = turnover – consumption costs [(raw materials used in the production process + energy and materials + water + rates and taxes + consumables and packaging) + (services including sub-contractors + plant and equipment hire + tech, marketing, HR, accounting services + rent)]

__________________________________________________________________________________
Divided by workers [owners and employees all active in the business]

How to get it right?

  1. Mindset
  2. Awareness and attitude – a growth mindset is vital
  3. Respect time – invest it or spend it
  4. Leadership – less time doing and more time leading, mentoring, delegating

  1. Diagnosis
  2. Core, strategic vs everything and anything
  3. Outsource expertise
  4. Increase efficiency, and innovate activities

  1. Execution
  2. Team driven to institute
  3. Measured to manage

  1. Change
  2. Culture and ethos of who we are and how we do what we do
  3. Hire for it, fire for it, reward for it
action

Why action is critical to overcoming the anxiety caused by uncertainty

Pavlo identified the 5 biggest issues threatening the survival and growth of established business owner, due to Covid and the challenges of lockdown:

  1. Cannot get access to funding
  2. Struggling to find new clients
  3. Cannot pay rent/suppliers
  4. Motivating staff and ensuring performance
  5. Anxiety and fear which is largely oriented around uncertainty.

He has already shared strategies and remedies for the first 4 and now talks to the last concern – Overcoming anxiety in order to set strategy for the year ahead. Listen to these in the podcast or read on for the key takeouts:

A lot of business owners are looking for a path of action, to simply tackle that anxiety.

What lies ahead is an extended period of uncertainty around Covid. Pavlo pointed to the time it takes to vaccinate people, when the vaccine becomes available – it is as slow as 4 people per hour, which means it will take a very long time for any vaccination programme to become nationally effective. As always, he reminds us to Expect the Best but Plan for the Worst!

The reason action it is important is because it puts you in control. Taking a view and acting to build your business towards a destination, despite uncertainty offers you a number of benefits including:

  1. Time – you can never get it back.

    When the lockdown happened, many people didn’t invest in growth, they learnt to bake bread and waited for it to pass. It was crazy, because for a business owner, the way you behave now, must build toward something in the future. At all times.

  2. Lead – you are the leader!

    The word comes from lædan, which means leading from the front, If you don’t lead in your business, who are your team supposed to look to?

  3. Act – the act of acting empowers you.

    So long as it’s directed, then over time it’s no different to compound interest and investing: it builds mass, and momentum.

  4. Energy agility

    It is so important to be growth mindset oriented all the time so long as you have control over the pedal, accelerator, steering wheel and rudder of your business. If you are, it creates a cultural mindset in the organisation that the whole team orientates around, and this puts you at the front of the market.

  5. Signals – how to identify the earliest signals of change and new change.

    Pavlo used an analogy of someone wanting to cross the highway. A BUSY highway. As a pedestrian standing still, all you see is a stream of fast moving cars. Whereas if you are in motion in the traffic – you see the gaps.

  6. No one cares – the brutal truth!

    If you don’t care, no-one else will, and if you have invested everything in that business, it is fundamental that you get out of the headlights and find a strategy to act.

In the next discussion, Pavlo will speak to the three strategies that he sees as critical to adopt to get you and your business on a positive trajectory to growth.

 

 

Reset Rebuild

RESET REBUILD REIGNITE ROUNDTABLE WITH PAVLO PHITIDIS AND THE GOOD THINGS GUY

Starting this Global Entrepreneurship Week, Reset, Rebuild and Reignite your business to win in the new year and beyond.

Join business growth specialist and author of Reset Rebuild Reignite, Pavlo Phitidis for a roundtable discussion on how to build a business that is not only resilient to crises, but takes advantage of the changes that they present.

Pavlo will be joined by Brent Lindeque, The Good Things Guy, whose mission it is to find the positives amid the negative. Pavlo and Brent want to discuss resilient mindsets that can turn challenges into opportunities, and they want your stories to unpack.

Tell us what you did to survive the Covid lockdown – or any crisis that faced you or your business – and you could earn your seat on the panel to discuss your  challenges and opportunities. Or just register to listen to the discussion and learn from those who have endured and come out winning!

The discussion will take place on Wednesday 18 November 2020 at 12h00 

It forms part of Global Entrepreneurship Week, and Bargain Books is offering 25% off all copies of Pavlo’s books: Sweat Scale $ell and Reset Rebuild Reignite for the week, 16 – 22 November.

Register HERE

business exit

Creating an exit roadmap

We spend years building a business to generate economy for ourselves. Mostly, we are undercapitalized and learn to do things ourselves. It becomes a habit. Then, of a day, we decide we want out. Or circumstances change and we want out. This is brand new to us despite the 10-20-30-40 years of investment work in our businesses. All your experience is in generating an income through your business, you have no experience selling it.

Understanding your exit roadmap early will serve you well. Listen to this podcast of Pavlo Phitidis’ discussion about business exit planning with Bruce Whitfield on The Money Show on 702 and CapeTalk:

Elements of an exit roadmap:

  1. Salable vs non-salable business

94.6% of all businesses started, fail to sell. Even the well-established ones. Think of it like a share you would buy on the stock exchange – what would you want from it?
You want to earn dividends each year hope, and when you are ready to sell it, you want to be able to sell it – for a capital gain. Your business is the same, it needs to demonstrate to a potential buyer the following:

  • Income growth
  • Capital growth
  • Tradability
  1. The buyer personas

Think of your potential buyer as a customer: That buyer needs to have a problem solved and different buyers have different problems, different skills and competencies.

  • The private buyer – an individual who wants to buy a business. Typically they work through a business broker to find a business that fits their own abilities and resources.
  • Management buy-out – this is seen often in professional services, where you generate income and value by selling time – medical, legal, architectural firms etc.
  • Family – the first generation sells to the next generation.
  • A business – where a business sees value in acquiring you.
  • A JSE listed business – these form the majority of buyers of private businesses. They look to acquire growth in revenue, innovation, or skill and capability, which often means they want you in it.
  • A foreign owned business – a multinational looking to gain a foothold into Sub-Saharan Africa but these are few and far between until we welcome foreign investment.

Identify who the most likely kind of buyer would be for your business, and think about what they would want, and how you should build your business to suit their wants and needs.

  1. The hurdles

It is very rare to get an outright cash offer for your business. Pavlo shared the story of an American business owner he worked with, who got this right. He did medical assessments for insurers and over a period of time he realized it wasn’t scalable as he had to do each patient visit. So he harnessed technology through Amazon, Instagram, Facebook, Google and used all of that data to create a risk profile for individuals, which he provided to the big insurers. When he was ready to sell he got a once-in-a-lifetime offer of $180million. But that was extremely rare. Most of us will not secure such a simple payment.

So who is buying what?

  • Private money – if you are selling to a private individual, how much can they put down and how much can they borrow from the bank? The need to borrow, especially in our current economic climate, caps these buyers at around R15 million for private money.
  • Business money – Between R12 million to around R30 million, a private business could leverage funds to buy you.
  • Corporate money – given the compliance, risk and legislation around transactions, one that doesn’t give them a business that generates at least R50 million plus, is not going to justify the pain of acquiring you.

This leaves a no-mans land between around R25 million and R50 million where there is no-one who wants to or can buy your business. And it’s important to know that, as you grow your business towards an exit

 

Kill your business cholesterol, before it kills your business

[vc_row][vc_column][vc_row_inner][vc_column_inner][vc_column_text]As a body grows and develops it also slows down. The years of life and living bear down on it and lying in bed for an extra 5 minutes rather than springing into action the moment the alarm sounds becomes tempting. An extra slice of cheese or a spoonful of ice-cream after dinner and a hard day also feels like a well-deserved reward. Cholesterol builds and if not checked, it’s the death knell that you often regret most when it’s too late.

It’s a terrible analogy to contemplate when building and growing a business, especially if you plan to exit it one day for a capital profit as your just reward for all the risk and sacrifice it took to build.

LISTEN TO THE PODCAST FROM THE MONEY SHOW ON 702 & CAPETALK HERE[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner][vc_column_text]

HOW DOES CHOLESTEROL BUILD IN YOUR BUSINESS?

1. In the beginning

In the beginning, you are in control of everything. You especially keep your attention on all things that bring money in and take money out. Sales matter enormously as do expenses. All your suppliers that you work with you get to know personally. Who are they, what value do they offer, what is the deal that you have with them and most importantly, spending as little as possible for as much as possible is as vital as getting sales into the business.

2. Then you grow

As sales come in and you get traction in the marketplace, complexity and activity both increase. Your attention moves onto the bigger cost items. Rent, people, vehicles, computing, software and the like. If you are in manufacturing, machinery and equipment as well as stock and inventory in other businesses. This matters because if you don’t buy right, you can’t sell right…right? The smaller ancillary expenses and consumption items fall out of your purview simply because you don’t have enough time. they are also hard to find in the avalanche of admin that governs and everyday growing business. In your mind, they are small costs and often difficult to understand. Do you truly understand your medical aid or cell phone contract? Such services are deliberately bundled and complexified to keep your attention on the idea that it’s just, say R52 per month. When you are spending R300k per month, you must focus on the big-ticket items. People tell you it’s the pareto principle, the 80% of your costs lie with 20% of your suppliers – focus on that.

3. Complexity builds stress that narrows your focus further

Nobody ever built a business by focusing on the pennies people will tell you. Unless you are Sam Walton, founder of Walmart or, Phil Knight, founder of Nike or, Jeff Bezos, founder of Amazon. And the list goes on because many pennies make a pound and so it grows from there. But the problem remains this. With more growth comes more complexity and opportunity and that, if managed well becomes more growth leading to further complexity. This cycle stresses you out because it’s a lot more to deal with in far less time than you ever had. You try bringing in people to help and even software too. Often that serves only to increases stress and complexity. Oh, and with your growth, where you now sit 50 times bigger than you might have been a few years back, those small expenses have grown too, not only in size, where the R52.38 is now R552.38 but there are more of these small, noisy little expenses. Your time scarcity sees you double down on the Pareto principle further feeding a false sense of belief that the leak is just that, a small leak if it exists at all. After all, it’s just one tiny spoon of chocolate ice-cream or a small slice of cheese, you say in the back of your mind!

4. Cholesterol, unchecked, generates the heart attack

With further growth, the cholesterol builds and as it does, it slows your body. The many, many small expenses, many for services you no longer need nor use add up to a chunky R50,000 monthly. Sure, your business now generates 100 times what it was several years back, but that bleed is a shock to you. You are furious and angry both at yourself and your team who are now largely looking after all the costs outside of the pareto margins. An investigation begins and you further discover that your team involved in procurement are missing obvious negotiation advantages that could have saved over R500 000 over the last 18 months. The cholesterol has built and set in and a makeover is needed before it kills your business, and you in the process.

This happens to most fast-growing businesses. Especially if its leaders have a big vision and are driven to grow and manifest the vision. The pareto principle is used as a constant reference to focus on what matters. Don’t sweat the small stuff is what most would say and often, those who say it, well, it’s not their money that is bleeding out the business.

HOW CAN THIS BE PREVENTED?

1. Develop a procurement strategy

Allocate all your procured items into one of three buckets – strategic and core, strategic and non-core, non-strategic and non-core. Once done, set quality, delivery and risk measures on them all.

2. Turn it into a system

Determine the times and activity schedule along with checklists to procure the inputs across the three buckets.  This includes how often you buy, at what standard of quality, from who, on what contractual terms and how often will you review it.

3. Train and capacitate

Train your staff in procurement on the system because now you have a system to train people on. Remember, staff have mostly not been through a process of starting something with nothing and so their skills in negotiation and understanding of its importance in cashflow will be limited, you need to pick the right staff in procurement and mentor their performance.

4. Structure and motivate

Create incentives by setting budgets and link the procurement buckets. If you have well-defined standards and performance expectations in procurement, any outperformance might well be incentivised but beware, the wrong behaviour within the wrong bucket can harm the business. for example, squeezing your insurance costs by dropping the standard of cover can cost you your business.

5. Hire and fire

Hire the right staff in the first instance and fire those that break with system. Procurement is prone to corruption and a well-designed system to bring your procurement strategy to life should be severely enforced.

We work with established business to build business systems across the entire scope of business activities. Systems deliver certainty, without which cholesterol can build. If it doesn’t kill you, it will slow you down and in the fast paced, competitive economy we live and play it, that could see your business being one of the 94.6% that are started but never succeed in a sale.[/vc_column_text][/vc_column_inner][/vc_row_inner][/vc_column][/vc_row]