Buying and Selling a Newsagency
NGBB are Western Australian business brokers based in Perth and owned by WANA. Our goal is to make either buying or selling a business in Perth a hassle free and profitable experience for you. We have been Selling Businesses since 1988 so you can be confident that you are in safe hands and that you will be well looked after by one of our experienced team.
Buying a Newsagency
There are many reasons to enlist the help of a professional business broker when looking to buy a business. With a wide range of businesses and an intimate knowledge of each of those businesses, NGBB are able to professionally guide you through finding the right business to suit your lifestyle and financial circumstances.
We’re on hand at all times to navigate you through the financial and legal maze leading up to closing a deal to buy a business for sale in Perth. With more than twenty years selling West Australian businesses, NGBB employs a team of experienced Australian business brokers whose industry knowledge will serve you well throughout the process of searching for and finding the right business.
Selling a Newsagency
NGBB’s team of experienced business brokers understand the years of dedication and hard work it takes to build a business. In fact, most of them were business owners themselves. When it comes to preparing your business for sale, obtaining an accurate and realistic valuation and navigating through the legal and accounting maze towards settlement and handover, having an experienced business broker at your side when you sell your business can have a positive and powerful impact on the outcome. We invite you to call for a no obligation discussion or request an appraisal.
Our retail market is a mature market with stable long term demand for newsagent’s core product. The continuing, and increasing, demand for news and entertainment, information, education, and personal services, ensures that newsagencies have been, and continue to be, a small business in high demand.
Newsagency goodwill is underpinned by the agreements that are in place with the industry suppliers such as Lotterywest, Newspaper and Magazine suppliers, which all combine to make a newsagency a sound business investment.
The features of a newsagency business is that it provides a stable investment with a comfortable lifestyle, it will also generally provide a capital appreciation over the period of ownership and is a readily saleable business.
Prices for newsagencies are determined by market forces and may range from a low of $100,000 to several million dollars. The purchase price is generally set as a multiple of the net profit to the owners, plus fixtures and fittings and Stock at valuation (SAV). To provide for ease of comparison newsagencies are generally presented for sale on the basis of the net profit to two working proprietors (if any additional staff are required their wages will be provided for in the financials).
The net profit (or EBITD) is defined as the amount of earnings available to two working proprietors:
a. Before tax,
b. Prior to owners drawings, and
c. Excluding borrowing costs and depreciation.
Specific factors such as geographic and demographic location, lease, type of shopping centre, trading hours, the age and condition of the shopfit and/or delivery equipment and the number and type of publisher contracts held will determine the multiple that buyers are prepared to pay for any particular business.
Purchasers should allow for an additional amount of approximately 10 – 15% of the goodwill of the business to cover purchasing costs.
The transfer process from price agreement to settlement in most cases takes 8 to 12 weeks; with settlement usually taking place on a Friday with the stock-take being held on Saturday. Your broker will advise the publishers and Lotterywest of the sale and each will forward their documentation to the purchaser.
Once the offer to purchase has been accepted the buyer will:
a. Secure finance approval,
b. Undertake “due-diligence”,
c. Have the lease assigned
d. Complete the ANF Newsagent Training Course,
e. Complete Lotterywest training,
f. Attend Australia Post Training if required
The old owner will provide the buyer with on the job training over the next two weeks after settlement. This is an important “settling In” period for the new buyer, as it is their opportunity to learn as much about the business as possible. The handover provided to the purchaser is something that you can have your broker negotiate to suit both yourself and the seller.
The entire transfer and sales process can be a seamless and smooth procedure, providing you have used the services and expertise of WA’s leading newsagency broker NGBB Pty Ltd.
For more information about buying and selling a newsagency visit www.ngbb.com.au.