WA’s Top Business Broker Reveals Secrets to Success
WA’s Top Business Broker Reveals Secrets to Success
‘Never ever give up’ is the motto Catherine Jones operates by. On the wall of her Zircom office is a poster of a frog nearly being eaten by a pelican, very fitting for this successful WA business broker who has pushed boundaries and experienced numerous successes over the past two years.
Bsale recently spoke to Catherine about strategic business acquisitions and her recent success at the AIBB awards where she took home the 2022 National Broker of the year award and the WA broker of the year for the fourth consecutive year in a row.
The business broking industry can be a tough one for young professionals to break into, as Catherine said, by the time you start working on a listing it can take 8 to 12 months for it to be finalised which can be a long time without making any money in the bank.
“The business broking industry is really interesting, there is a lot of older brokers I would say it would be an ageing industry. We’re mostly paid on commission and most brokers I believe operate that way, so that is a long time to go not earning money for 12 months. That’s why I think for me coming into the family business, it’s given me a good start and I’ve been able to make it really work for me.” Catherine said.
Coming from a background as a chartered accountant working in tax, business advisory and business valuations, Catherine says that this has been a grounding feature in her career as a business broker.
A Unique Approach to Selling as a Team
Zircom Business Brokers have a unique approach to business broking, their model is based on working together as a team and literally as a family.
“David is my father and he owned Zircom, that’s how I made the move there 8 years ago. That’s really where it all started, Zircom itself, we’re a family business my dad, my mum, my sister and myself. We are a true family business. It’s just the four of us.”
Drawing on each other's skillsets and experience is core to Zircom’s business model. For example, David Screaigh, managing director of Zircom, has over 20 years of experience in the broking industry and Catherine says she feels incredibly “fortunate because he is a real mentor”.
“We work as a team, we work on all of our listings together and that’s how we run our business, so we’re quite unique in terms of business broking, we all operate as one as a true team. We realised we could achieve more by working together and working to our strengths, doing what we are good at. ” Catherine said.
As a team of qualified accountants, Catherine said they run their business in the same way a chartered accountant would run their firm, using the same approach and principles.
“We want to make sure, someone is trusting us to sell their business and it can often be one of their biggest assets, they normally only do it once or twice in their lifetime so they have to trust us and we need to work with them to get them a really great outcome and if we want the experience to be a positive one especially when it is such an emotional time for them.”
“We actually charge for appraisals, everybody has different approaches across the industry, we do it properly and take a lot of time with it because we want to be able to provide the best advice to our sellers and set their expectations so they know what to expect and the journey they’re about to go on.”
A Good Appraisal is the Key
On the Zircom business model itself, Catherine said they spend a lot of time during the business appraisal process at the start. Spending a lot of time appraising the business correctly saves time at the end of the transaction and makes for a smoother experience for the seller and buyer.
“The kind of businesses that we sell, they’re often very specialised, and each one has their own thing that’s a little bit different and we want to identify any potential issues early on. We don’t have to have all the answers, we just need to know that could be an issue and you might need to get some tax or legal advice on that. You don’t want somebody to get all the way to the end of the process and to then discover ‘oh if I’d known that, I wouldn’t have done that’.”
“I’ve always found the one thing that stops a deal or ruins a transaction is surprise. We always say to people, both the buyer and seller, we want to avoid any surprises”
“We want to know about it, talk to us about it at the start and we will find a way to address and find a solution for it and make sure all parties are involved. It’s all about that trusted relationship.” Catherine said.
What Makes a Good Business Broker
“We price and sell businesses that‘s what we do but really, a big part of it is that we manage people's fears and emotions. That’s what it is really all about at the end of the day.”
Catherine loves being a business broker, it really is her passion and while it has its ups and downs, the flexibility and independence are worth it. It’s “bloody hard” being a business broker as you need to have a good grasp of a variety of skills, it is truly a multidisciplinary profession.
“Most people will only sell their business once in their lifetime, someone who has had their business for 30 years, it’s their baby, that’s often people's identity and we see it time and time again. They’ve obviously worked really hard on it and they have staff and lots of clients they care about, it’s hard to let go and that’s the emotion that we have to manage. The seller has their concerns and fears they need to manage and the buyer has theirs, and that’s our job to be able to coordinate and manage the process and have a trusted relationship with the buyer and seller. That’s how we get the deal done.”
“It is a highly emotional time for the seller and the buyer and that’s why we often say to people that it is a matter of not just finding any buyer but you have got to find exactly the right buyer and if we can do that everybody is happy and it goes smoothly,” Catherine said.
“I’ve really found that there will be lots of things that will crop up in a business sale, no matter how prepared you are and things are always changing and there are so many other parties when it comes to a business sale.”
“You’ve obviously got the buyer, seller and the business broker but you have also got accountants for each party, lawyers, landlords, clients, staff, suppliers… There are a lot of people involved, albeit not directly, and there will be things that will crop up and you have to deal with it and know what to do and what is best for that particular situation in that time.”
When it comes to being a good broker, it’s the business appraisal process, setting realistic expectations with the seller, that Catherine thinks is crucial to the business sale.
“I also think communication is really key in the business sale and making yourself available to talk through any issues or matters with the client. I only act for the seller, I don’t do any buyers advocate work, so for me, I say to the client ‘you can call me on my mobile any time, if you’ve got something on your mind I want to know about it because I need to know what is going on in your head I need to know what is going on in the buyers head’.”
“Being available and talking through any issues or matters that arise, and that is in conjunction with the accountant and lawyer with the transaction team, to keep everything moving forward. If we’re able to do that, then we can get the deal done for both parties and everybody is happy.” Catherine said.
Credibility is also an important factor in building these relationships with all parties involved in the sale and Catherine has found that credibility has played a role in her success.
“I think for me- it’s just forming that trusted relationship with the buyer and the seller as much as possible, that helps everything run smoothly. Being a chartered accountant and a member of the AIBB and a registered business valuer does help as well, people can see that you’re professional and care about what you do. That has helped us.”
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Finding Success
The 2022 Australian Institute of Business Brokers (AIBB) Awards were held in Sydney in August and Catherine's hard work and accomplishments in Western Australia were recognised for the fourth year in a row, as Catherine has taken home the WA Business Broker award of the year consecutively since 2019 and this year Catherine was also the recipient of the National Broker of the year award.
“I was very excited [to win] the national, that is a big achievement and one I’m really proud of. It’s always nice, I love what I do and I’m really passionate about it and I’m really grateful that I’ve been able to discover this industry and work in it. So I was obviously really honoured and very excited to win that but it’s also been good because it’s recognition because of how I’ve helped our clients on their journey.”
“Everyone's journey is different, some have gone into retirement some wanted to move on to another business or another phase in their life or they’ve moved away and winning an award like that reminds you of all the hard work and all the people you’ve managed to help along the way,” Catherine said.
Key to her success in WA the past few years, Catherine credits staying focused, always looking for solutions and quite simply, never giving up.
“Something else that led to my success would be never giving up. There have been many times there where you just think ‘oh gosh is this going to go through?’. We actually have this great picture of a pelican and a frog on our office wall and the frog is saying never ever give up. You know you never give up, you always keep at it.” Catherine said.
Acquisition and Strategic Buying
The kinds of businesses that Zircom predominantly work with are large private businesses that are acquired by other large private businesses or corporations for strategic reasons and Catherine said that the market right now has been really good for this kind of sale.
“There are many businesses that are looking to grow via acquisition and they’re looking for something that is not necessarily always a competitor (obviously that does happen) but is often a business that is aligned to another business. For example, we had a large underground cabling business for sale and we sold that to a business that did above-ground cabling. They were outsourcing their underground cabling and thought ‘if we buy this [business], we can bring that work in-house and we are going to have new clients we can service and new product’. It’s really great synergy, a really great opportunity.”
From a buyer's perspective, it’s better to find somebody that is already thinking of selling their business, rather than approaching a business they feel would make for a good addition to theirs.
“If I was a buyer wanting to strategically buy a business to bolt on to operations, I already have a great place to start by searching on websites exactly such as Bsale and starting there. This way you have got a willing seller that is ready to sell.”
“I think the key thing is.. if you’re buying a business you want to make sure you’re dealing with somebody that actually does want to sell, you want to deal with somebody who has realistic expectations and you want to make sure that they have the correct information available.”
“As I’m sure most brokers do, we spend a lot of time preparing detailed information memorandums for every business that we sell and that’s a really critical part. So as the buyer you want to be dealing with a seller that has the information memorandum available so that you can assess the business very quickly and know that you’ve got good quality information andare being guided by a professional business broker and I think that is really important.” Catherine said.
The Market
In Catherine's experience, there have been a lot of great businesses coming to the market at the moment that “present these great strategic opportunities and they could be in all industries”.
“It’s been a very interesting couple of years and I would say- it’s been tough for business brokers, especially depending on what state you operate in and [during covid times] we were very fortunate in Western Australia. I definitely didn’t see some of the pain some of my fellow business brokers have seen.”
The 2022 market was stronger than Catherine originally had anticipated, presuming Australian buyers would be nervous coming out of the last couple of covid-affected years though this was not the case at least in Catherine’s experience and that most businesses have been faring much better than expected which is a trend Catherine expects to continue through to next year.
“I had the best year in our business that we’ve ever had last year and I think this year is continuing to be the same so in that regard, there is definitely a lot of transaction that is happening.”
“It’s been really positive in that regard and I think, or what I have been finding, is that there are some fantastic businesses coming to market now, some great opportunities for strategic acquisition and I think over the past few years covid did cause some sellers to reset and reconsider what they wanted going forward. They’ve reassessed where they’re at, they seem to focus more on their health and a lot of them have realised they actually are ready for their next chapter.”
“Before covid, they were just doing the same thing again and again and they weren’t quite ready to sell yet and it sort of triggered that for them and you know what, I’m ready to go into retirement now or I want a less stressful lifestyle or now being able to travel again.”
“In many cases businesses especially in the market I’m operating in, they don’t have a succession plan as such, their children (if they have children) are out pursuing other interests and they’re not interested in running the business, they have gone on their own path in their own direction. So the succession is for us to take it to market and find a great person to acquire it for them and continue the business on.”
Looking forward, a lot will depend on the sentiment of buyers and the availability of financing and the economy more generally but Catherine expects that the strong market we saw this year will continue into next year.
“I mean you never know with these things, time will tell, but what I do know is that even throughout covid we’ve seen businesses do extremely well and it’s been really positive and there is activity happening and people are buying businesses and I expect that to continue.”
“I think there is still activity from both buyers and sellers and I personally think it will continue to be a strong market for businesses buying other businesses for strategic reasons in the future.”
Tags: business broker career selling success wa
About the author
Caitlin Mary
Journalist
Caitlin has a background in media and communications, studying journalism at University and doing various freelance writing and production work over ...
