It’s Not Rocket Science! Five Questions Over Coffee with Peter Miller (Ep. 20)

Who is Peter?

Peter runs https://succession.plus/uk/

Over the last ten years, our 21-step process has helped over 600 business owners maximise the value of their business and achieve a successful exit.

Key Takeaways

• Begin with the end in mind

• you’ve got to have a realistic idea of what business is worth with some owners try to get something I’ll never achieve,

• An exiting owner has really got to ask the question, well, what’s left? What does the buyer get after I’m gone?

Valuable Free Resource or Action

See more at https://succession.plus/uk/

Subscribe to our newsletter and get details of when we are doing these interviews live at : https://TCA.fyi/newsletter

Subscribe to the podcast at : https://TCA.fyi/INRSFQOC

Find out more about being a guest at : https://TCA.fyi/beaguest

Transcript

Note, this was transcribed using a transcription software and may not reflect the exact words used in the podcast)

Stuart Webb 1:07

So what’s the biggest challenge your ideal client faces?

Peter Miller 2:30

Right? Well, the ideal client is a business either private or family business. And they’re thinking about passing the baton on to the family or selling the business exiting in some way. So my ideal client is somebody who’s within 10 years of exiting their business, those who want to get out tomorrow, it’s a bit harder. So it’s ideal to have somebody who’s got a timeframe to work for or towards, help them identify what their exit options are, and put together a plan to implement it.

Stuart Webb 3:09

And what are the common mistakes people have made when trying to solve that problem without any help.

Unknown Speaker 3:15

And

Peter Miller 3:18

two things, start with evaluation, you’ve got to have a realistic idea of what businesses with some owners try to get something I’ll never achieve, and others really leave too much on the table. They give it away. And then the business needs to be made sale really. A lot of businesses we work with. They’re doing all right, financially, not all of them, of course, but if they’re doing good a good scorecard financially, but then what about the non financial issues? And how really is that business? For sale or and by sale? I mean, it could include transition to co owners or employees or around a family.

Stuart Webb 4:03

So what would you describe as some of the issues that people have when it comes to that not being sale? Ready?

Peter Miller 4:09

Well, they may, for example, be the business guy that they’ve really got to ask the question, well, what’s left? What does the buyer get after I’m gone? Sure, sure. There’s a lot that can be done even for a small business. Like at least dependent on its owners. also things like their systems, their procedures, that they’re as easy as possible for somebody else to pick up and run with.

Stuart Webb 4:45

Yeah, it’s often true, isn’t it that you can get you can get something like three times the sale price. If If your business isn’t documented but closer to six or seven it is because it makes it so much easier for the new buyer to pick up.

Peter Miller 4:58

Absolutely. So they’re probably the two things that own independence. Not everything, everything, just in your head, but written down and easily accessible. Are we still on it? Yes, we’re still on it. Sorry. So you carry on here? Yep. All right. Let’s computer seems to drive itself. No, no. You signed, you’re fine. All right. So yeah, they’re there. And also, perhaps just not really knowing how to go about it, or even understanding the financials of the business. For example, you might have a panel beater, or some other trades person could be an architect. Doctor, I’ve worked with people from, you know, medical specialists, scrap metal dealers, they they’re good at their particular trade or profession, that they may not necessarily have the mouse to prepare a business and set it up to in a way that it will be attractive for someone else to.

Stuart Webb 6:04

Yes, yes. Course. Brilliant. So what’s the valuable reaction or the valuable free resource that you can direct people to that will help with that problem?

Peter Miller 6:17

Probably the best thing is a book that I co wrote with a colleague called Craig West. And it’s called enjoy it, work through it a 21 step process, they’re actually Well, they’re five stages, and each one of those stages has various steps, we start by identifying value of the business, then we want to protect that value. The third thing is to increase or enhance its value to maximise its value, then we look at extracting the value. And the final step is well, now the business has sold and what do we do with the cash? How do we manage that value? You know, could be 1520 years after the owner has exited the business that they need to they’ve drawn their last paycheck from the business, they still have to survive, they have different sets of issues, that you know, they have families, whatever, and what are they going to do over there? You know, for the those next few years, so where can we get a copy of that book? They did? Well, now that it’s on our website, so it’s just a matter of clicking in and

really getting it, which is can you point us to that, that website? We’re just telling us where it is? Yes, that’s succession plus you might have a.co.uk

Stuart Webb 7:50

succession plus as p R Us?

Peter Miller 7:54

Yes, succession p R Us. just.co.uk. Yeah, try, try that there. And that should get you there.

Stuart Webb 8:04

Terrific. We’ll get everybody to go and immediately start looking at that book and starting to implement those sessions, that those steps because they sound like the right steps to take. Even if you’re not thinking about selling your business, they sound like the right steps to take in order to be able to start building value in an existing business. Even if you’re not thinking of exiting, you’ve got work for years and years.

Peter Miller 8:29

Yeah, in fact, better leave time you have working through a plan, the better it is. And what we found is, is that there are surveys that have been done by a number of universities, certainly in this part of the world where they they found that as few as one in 10, owners would have a written exit or succession plan. Now, some surveys give a higher figure, but I’ve had accountants turn up at my seminars. And one of them particularly wrote to me afterwards and he said, Well, I’m surprised that as many as one in 10 play. I’ve never seen one of the last 25 years I’ve been in private practice.

Stuart Webb 9:09

Wow. Okay, that’s brilliant. So, you talked then about that, that book? Are there other concepts or, or or talks that have made a significant impact on your experience?

Unknown Speaker 9:26

Yes,

Peter Miller 9:27

I mean, my own experience of getting into this. I’m a financial planner, I started out as an insurance advisor they got into investment. I had a business with based here in New Zealand 30 Associates here and another 20 of Australia, just in the states of Victoria and Tasmania. And I sold that and in the process of selling it. I discovered the steps that you need to go to to come out of it or go through to come out of that business successfully. And there was some research going on, and you’re in a university in Melbourne, as well as here in Auckland. And I got into that. And I said, Well, hey, maybe I can help others who have got the same issues. And then I was at a breakfast meeting for work for financial advisors in Auckland. And I happen to sit next to the head of advisory services for the ANZ bank, which is the largest bank in New Zealand. And he knew what I’d been doing previously, how’s it going? I said, I’ve sold out. What are you going to do next? And I sort of told him what I had in mind about succession planning. He said, we shouldn’t be doing that in the bank. Yeah. Two months later, I was in an employee, the bank 12 years associated with the bank before I finally I won’t say retired, because I’m still doing this. These days working for a home office. But I’m associated with now with the succession pass, which is the largest succession exit planning business in Australia, a separate company here in New Zealand, and also it started in the UK and 2019 wonderful timing just before COVID?

Stuart Webb 11:24

No, well, you know, even even those, I think it’s heightened thing, hasn’t it a big crisis like that, and started making people aware of just how, how they build value in their business and how, you know, even within the crisis, there have been opportunities for growing and building your business. People just have to recognise it.

Peter Miller 11:45

Well, absolutely. And I mean, some of the clients, I’ve had thought the business was only worth the value of the assets. They had no idea of its going concern value. And were absolutely amazed at what they got. Others, of course, in the opposite situation, that likely exiting the business is likely to be the biggest transaction. Anybody does.

Stuart Webb 12:12

Yeah, absolutely. I mean, and as he said, it requires significant planning. And if you can give it if you can actually start your business, knowing where you’re gonna end up, you end up with a much higher valuation anyway.

Peter Miller 12:24

Absolutely. Yes. The old saying begin with the end in mind.

Stuart Webb 12:27

Right, Stephen Covey’s book? Yeah, absolutely. So, Peter, as we’re coming to the end, what is the one question that I should have asked you? That I haven’t? And and if you wouldn’t mind answering it as well? Well,

Peter Miller 12:45

the one question that you should have asked. I think you’ve covered it pretty well. Yeah. One of the questions we get, of course, is what does it cost? Yes. And

that can be answered in a number of ways. I mean, if what we find is, is that if we can increase the value of the business by a whole lot more than the cost, then it’s got to be worth it. And in fact, we can do that many times over. It’s not going to happen a day or a week, you but we need to set out an implementation plan. So what we do is, we analyse the business, then prescribe a remedy. Work with the business owners to help them implement the recommendations, and then take them right through to the sale of the business.

Stuart Webb 13:44

That’s that’s a great sounding plan for a business actually better I like, I like the sound of that for any problem, let alone for a business. It’s a business owner is thinking of selling up.

Peter Miller 13:56

Yes. So that’s, that’s probably the question, what do you do about implementing the recommendations? And yeah, the answer is we haven’t haven’t adopted we do an advisory programme, working with them. Usually a meeting, say once a month, and it goes on from could be from six months to 18 months, whatever is needed, we have sometimes been going for a couple of years, just implementing or helping them to not doing it for them, but guiding them to the implementation of other things that need to be done.

Stuart Webb 14:27

Brilliant. Brilliant. Where can we find out more information about all of that? And when websites best starting place, and that’s succession that was? Yes. co.uk. That’s right. Terrific. And that’s where we’ll be sending all of the listeners to this immediately to, to read up on that. I think that’s a brilliant set of advice. Thank you, Peter, very much for your time. appreciate your efforts, and I hope that this brings a whole load of additional stuff to the show. To the audience, and just for those of you are listening, if you want to get notified when we’re doing these and you want to keep on our mailing list, if you go to TTA dot F fi, forward slash subscribe, that’s tcaa dot FYI, forward slash subscribe. That’s a place where you can get all sorts of information. And you will see more of the sort of interviews in the future. Peter, thank you very much for your time today. I appreciate the the time you’ve spent with us and I hope that people get value out of going to that session plus.co.uk website, and seeing how that helps them to build their business better. It’s a pleasure. Thank you, Peter. very much indeed. And I

Transcribed by https://otter.ai