Start with Financials. Are your turnover and profit (EBITA) consistent, increasing, or declining over 2-3 years? If it is consistent or increasing, multiply the EBITA by around 2.5 or 3 times to provide a base value. To value intangibles (goodwill, etc), look at it from the buyer's perspective. What value are they likely to see in features like qualifications on scope, registration length, enrolments, CRICOS, ELICOS, Govt' Funding, and industry contracts? This will vary amongst buyers and may add minimal value to your financial valuation. The next test is the boyance of the current market. How high is the industry 'confidence' and risk level? Which sectors and features are buyers seeking? How quickly can buyers recover their outlay?
Generally, we will list all RTOs on our database. If we feel it will sell and the vendor is a genuine seller with realistic expectations, we will spend time and money to find a suitable buyer and negotiate the best price and terms for the vendor. Here are three key barriers to us selling your business:
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Overpriced. Aiming high is part of the process, however, it's a time-waster when vendors are unrealistic.
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Lack of Information. We request basic information when we list a business and usually seek further information as the sale progresses. We can't sell a business if we can't provide details and features.
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Tardiness with responses. Buyers lose interest when vendors are slow with information or decision-making.
What is going on with ASQA?
There is a difficult balance between supporting an industry and policing poor or dishonest conduct.
The Government, and through its regulator, ASQA, made their first mistake when they created an environment in which RTOs became a commodity. By making it so difficult to gain a registration and taking so long to process applications, an industry grew in which people registered RTOs to simply sell. This provided a product to others who did not have the expertise to apply or didn't wish to wait for the lengthy processing time. Rather than address the root cause, ASQA has applied all sorts of 'band-aid' fixes.
The answer is simple. Improve efficiency, achieve timely processing, and support RTOs to achieve.
