The vast majority of readers will be parents, and due to the trials and tribulations in every child's early life, you will have developed the habit of dispensing advice to your offspring to assist them along life's path. This may start from preparing young Mandy for her first "Show and Tell" at school, to getting young Matt ready for his first game of footy. Whatever the matter that requires your assistance, and whether or not that assistance was requested, you will be surprised on reflection, how often your advice was based on the importance of planning and preparation. Young Mandy will have little fear of speaking in front of class for the first time if she has first been coached in how to break her topic up into parts and then has already delivered her piece in front of parents and/or siblings. Similarly young Matt will be less concerned before running out onto the footy pitch for the first time if he has already spent a few hours in the park kicking and catching a ball with dad.

Why then, when we all are very adept at handing out good advice based on the fundamentals of planning and preparation, do we fail to heed the same fundamentals when the time comes for us to sell our Management Rights business. The inimitable words of Baden Powell, "Be Prepared" should be resonating in our heads, yet more likely the words we are reacting to are the Monty Pythonesque "Run away, run away".

All too often as brokers, we get the call to list a business because the manager has just felt the weight of that last back breaking straw. Many a straw preceded the "last" one of course, and somewhere well before this time, the light should have gone on, that he should start preparing and planning to sell the business. A well reasoned approach to selling is of course preferable no matter what the class of business, but it is critically of more importance in our industry. It is an unfortunate fact of a Management Rights broker's life that around one in every 4 or 5 contracts that he signs up, will fail to proceed through to settlement.

Management Rights contracts are complicated affairs. They can take an age to negotiate, a while to physically prepare and then they are conditional for many weeks on due diligence provisions for verification of the accounts, verification that the agreements and other paperwork is in order and then further subject to finance. Frankly if a buyer wants to get out of a management rights contract, he has more means of escape than Houdini on his best day. All the more reason then, to be proactive rather than reactive when it comes to selling your business. If the right amount of preparation and planning has taken place before and during the sale process, then hopefully the idea of escape or opportunity to escape, never presents itself to a buyer.

So what sort of things am I talking about? Well the first thing is to make a decision well in advance of when you decide you want to sell. If you are feeling a bit jaded and think you have just about had enough, then make the decision that you will list for sale in say 6 months.

Having made that decision, get a checklist together of all the things that should be done to ensure that the sale process will be as orderly as possible. The checklist will have a host of things.

By example the one we have prepared for our clients has 20 items to check off. Amongst these are our Point 7 which suggests making sure you have signed Form 20a's for each of your rentals and that each of these forms has the assignment clause ticked and initialed. Our Point 13 says: "De-clutter the manager's unit, remember it's the buyers' next home."

So if even the hint of an idea has crossed your mind that selling is a near term option, drop us an email to mike@raas.com.au and we would be happy to email back out a copy of our checklist document titled, "Preparing Your Management Rights for Sale - Tips traps and strategies".

Hopefully with a little planning and preparation, your business won't be one of the 4 or 5 that have to be contracted a second or third time. You will be grateful if you can avoid this eventuality - Scouts' honour!

www.raasrights.com.au • www.raas.com.au