“The difference is they see me and my family as the client, not just my business... Garry and Will Austin, GAZMAN ...that perspective makes such a difference to the way they approach our relationship.” Garry Austin, GAZMAN “Increasingly, we see ourselves as wealth managers to our business owner clients. We seek long-term relationships and provide high-value innovative services focussed on the owner, not just their business. The integration of this service delivery is unique.” John Clark, Chairman Contents Building your business 3 Protecting you from risk 5 Fordham Wealth Advisors Keeping it in your family 7 Specialisation Advising owners of private businesses Your exit options 9 Key areas of practice Tax and accounting, investment management, strategy and planning Preserving your wealth 11 People Approximately 200 Transitioning your wealth 13 1 Building your business “We have big plans. Today, nine successful outlets. Soon we will double, then double again. They help me do this and manage my exposure to risk.” Simon Crowe, owner Grill’d 2 Business ownership allows individuals to create Business owners benefit from the objectivity and and grow something very special. Something which breadth of experience of our specialists. This sets they know and understand. Something in which the direction for change and is invariably a turning they shoulder all of the risks and enjoy all of the point in the lives of many business owners. rewards. It’s theirs. Issues typically addressed include structure, But it can be lonely out there. growth, funding, marketing, people, acquisitions, equity, participation and problem solving. Right from the start (and regularly over time) Through this, the relationship becomes one Fordham directors take our Business Services of proactive involvement in all aspects of the clients through an intensive strategy process. business. During this time, we challenge our clients as to their concerns, strategies, goals, resources and rewards. Grill’d Specialisation Healthy burgers Growth First store was only opened in 2004 Stores Nine People 25–30 per store Obviously, Fordham is not your typical accountant! 3 Protecting you from risk “They [Fordham] have totally changed our lives. When we met them nine years ago, we didn’t know what we were missing. We know how to make great gears, and they know how to build great businesses. They worked with us and taught us how to professionalise our approach. They help us manage our risks. 4 5 That’s why I keep referring my colleagues to them.” Gordon New, Managing Director Ronson Gears The business is usually a means to an end. Its Is tax being minimised through long term role is to generate income to support the owner’s structuring or short-term, last minute efforts? lifestyle and hopefully build a separate stream of wealth along the way. It finally provides a one- What would be the impact of unplanned ill health off opportunity to generate wealth at the time of or death on the family? Are the wills effective? ultimate exit. Do they address assets located in trusts and superannuation funds? All too often, the business is seen as the “nest egg”. All too often, all of the eggs are in one basket. Are family trusts and structures a mess? Do they All too often, the owner is too busy running the require diligence and consideration to get them back business to look at the big picture. in shape? Are they effective for taxation purposes? What will happen to them when the owners die? If something goes wrong, what assets are at risk? What firewalls are in place to limit the impact of a Fordham helps clients understand the issues, financial disaster? help set the agenda for getting back on track and manages the resolution of the projects from issue How long is it since the structure was reviewed to identification and prioritisation through to the ensure that income taxes are being legitimately successful conclusion. minimised? Have recent tax legislation changes made the ultimate disposal of the business unnecessarily exposed to capital gains tax? Ronson Gears Specialisation Gear manufacturing and exporting Turnover $10 million Ownership Now second generation People 36 We help clients sleep at night. Keeping it in your family “We were with a big accounting firm, but then our bank introduced us to Fordham. 6 We needed help to untangle our succession plan, which had become over-complicated, and had been unresolved for quite a few years. Fordham were talented and persistent. With their help, we sorted through the issues, and were both thankful and impressed. The business remains in the family, and Fordham’s approach and effort gave us the confidence to switch all of our accountancy and taxation work to them. With over 4,000 customers, 24,000 products, six locations and 100 staff, we needed a long-term partner who took the time to really understand our ethos and business. Looking back, talking to Fordham has turned out to be a great decision. With Fordham’s help, we’re continuing to remain an integral part of the lock and security products industry in Australia.” Mark Johnson, owner Locksmiths’ Supply Company One hundred years ago, young adults left their Proper planning can manage succession issues and parents’ farms and sought a different future in provide a framework to facilitate a transition of the the cities. Today, Generations X and Y are making business to the next generation. It is imperative that similar decisions. Not only are their career choices children are not set up to fail…especially in the eyes varied and interesting, but their attitudes to the of the numerous participants inside and outside of family business are...well, different to those the business and family. of their parents. The process must be managed. With broadening generation gaps and a capital market hungry for well run private businesses, the Similarly, it is important that the children value family business now rarely sees the next generation. their opportunity. Any transition from student to employee to management and ultimately to owner But it can. must be carefully planned and openly discussed. Rights and responsibilities for all family members must be understood. Locksmiths’ Supply Company Throughout Melbourne, Fordham is well known for Specialisation Wholesale suppliers to locksmiths, its family business advisory methodology and its hardware and building industries success in helping family business owners keep it Ownership Third generation in the family. Coverage Australia and New Zealand People 100 7 Your exit options “When we met them [Fordham], our accounts were outdated and not up to recognised standards, we didn’t have stock control and worked out of nine factories. Our massive growth had taken its toll and our continued expansion caused us to look for a more professional approach. 8 It took two years and they had our business on track. We put in systems, structure, reporting and accountability. This preparation equipped our business to become more saleable and attract the interest of a major global company. They ran our sale process and we got a fantastic outcome. They have even helped us protect and invest our money...tax effectively of course.” Maurice Smith, former owner Allcare Disposable Products If you were selling your family home; you would be As with most engagements, proper planning can unlikely to sell to the first stranger who knocked on help prepare the business for sale, and maximise the front door. Most likely, you would first attend its value on exit. Whether it be in six months or six to repairs, add some fresh paint and tidy up the years, different sale options should be considered garden. You would engage the best professionals to and the most appropriate to the specific business help you properly represent and promote your home. type identified. And so it should be for your most valuable asset… Tax considerations are always important. The right your business. advice can make millions of dollars of difference. Fordham helps clients understand the valuation of The sale process itself requires extensive project their business, how to build that value and how to management with the production of an Information optimise and time an exit from the business. We Memorandum, instruction of legal advisors, also help clients appreciate the importance of a promotion within the constraints of confidentiality, potential strategic fit with any future owner and how management of interested parties, hosting due that fit can be identified, marketed and exploited diligence enquiries and ultimately execution of a strategically. The various types of exit options are sale agreement. always analysed. Finally, after well-deserved holidays, we help owners to have a strategy in place to remain mentally challenged and a plan to create Allcare Disposable Products Specialisation Packaging and safety products Turnover $24 million Ownership Now sold Sale outcome Better than we ever hoped! meaningful identity in their post-ownership period. 9 Preserving your wealth “We ran a great business. We understood it and we were diligent in our approach. Investing is different. We needed guidance, rules and day to day help.” Garry Hetherington, former owner Holiday Hub Beach Resort 10 Business owners usually excel in building wealth Fordham’s clients benefit from a unique approach to within their business (Active Wealth) but frequently maximising wealth based around strong beliefs in: do not apply these skills to managing wealth – Independence outside the business (Passive Wealth). – Long-term focus – Integration Building, maintaining and preserving Passive – Risk mitigation Wealth requires patience and expertise. It requires – Transparent, commission-free fees an understanding of goals, objectives and risk from – Client reporting and involvement the family’s perspective rather than the business’s. – Strategies based on business fundamentals It requires careful consideration of structures – Client control and entities in terms of taxation and protection; consideration of family from estate planning Full details of services provided are available in the perspectives and consideration of lifestyle Financial Services Guide provided to all prospective and security. wealth management clients. Given a Financial Planning industry with a history of secret commissions, a lack of transparency and independence, poor skills and very bad investments, it’s no wonder that business owners seek to do it themselves. Holiday Hub Beach Resort, Pambula Beach Specialisation Amazing family holidays People 40 Ownership Now sold New roles To help others in our community 11 Transitioning your wealth “We were looking for an accountancy firm to be a real business advisor, not just one to balance the books...” Cathy Grant, business owner Grant Day James 12 It is remarkable that business owners let their The end result should be a manifest containing wills become so old and out of touch. Some don’t such documents, structural explanations and even have one. After building wealth in trusts and other information necessary to provide guidance to superannuation funds over many years, owners are survivors as to how to deal with the complex affairs often surprised to discover that these funds are not of the deceased. From bank accounts and insurance covered by their wills. The destiny of their wealth is details to suggestions of how to dispose of the family left in the hands of various trustees. business. It can make all the difference. The consequences can be horrible. Poor Fordham calls this Inter-generational Wealth Planning. estate planning is probably the single biggest contributor to the destruction of family harmony after the parents have passed away. These sad consequences are usually preventable. Estate Planning involves consideration of businesses, structures, trusts, investments, children and grandchildren, trustees and appointors, spouses, philanthropy, lifestyles, life expectancy and health. Proper planning integrates these components. Fordham manages the various third party professionals and family members to ensure timely completion and understanding. Grant Day James Specialisation Advertising Ownership Partnership of three families 13 Services For the business For tax For wealth Business planning Tax management Succession planning Business structuring Structuring Wealth accumulation Benchmarking Research and advice Shareholder agreements Profit improvement Capital transactions Inter-generational wealth planning For capital restructures For investment Sale of business Portfolio management Valuations International equities fund Acquisitions/MBO Garnet Superannuation Fund Financing assistance Divisional director contacts Business advisory Corporate finance Investment services Peter Carroll Michael Sutherland Paul Ashworth +61 3 9611 6631 +61 3 9611 6706 +61 3 9611 6700 Taxation Motor dealer services Superannuation Brendan Henderson David Buckley Anita Collings +61 3 9611 6631 +61 3 9611 6601 +61 3 9611 6600 Strategy and planning Chris Alp +61 3 9611 6631 Fordham Wealth Advisors PTY LTD ABN 24 752 998 186 ACN 120 438 155 Rialto Towers, Level 35, South Tower, 525 Collins Street. Melbourne Victoria 3000. Australia GPO Box 4369. Melbourne Victoria 3001. Australia T. +61 3 9611 6611 F. +61 3 9611 6666 W. www.fordhamwealth.com.au © 2007 Fordham Wealth Advisors. All rights reserved. “Fordham” and “Garnet” are trademarks owned by Fordham Pty Ltd.
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