Norman Jackson helped an entrepreneur buy a secretarial recruitment company for £1 million. Turnover was circa £2 million.
In the negotiations, we persuaded the vendor to accept £300k of deferred payments to be paid one year after completion – so when payments were made, they were paid out of the profits of the company. Shortly after completion, we also sold the “non-core” part of the business for £200k – so the actual acquisition cost was only really £500k.
Over the next five years, Norman held a business advisory / mentoring role with the company, helping turnover increase to £7 million. In the main, this was done by adopting good business practices, namely:
Agreeing a strategy to be in a position to sell the company after five years.
Putting in place attractive remuneration packages for key personnel.
Devising a varied Marketing Plan and ensuring implementation took place.
Instituting stringent financial controls and ensuring accurate Management Accounts.
Adhering to the disciplines of monthly Board Meetings with Agendas, Minutes etc.
Identifying potential risks and thus avoiding unpleasant surprises.
Through a business broking colleague, I had identified a company that was a likely acquirer and just over five years from the original acquisition, the company was sold for £3.5 million. The entrepreneur retired to the Caribbean, a satisfied customer.