Build It and the Money Will Come: Master The 5 Secrets to a Successful Building and Property Development Business

BUILD IT

and the money will come

Master the 5 Secrets to a successful building and property development business

‘I have personally known Tony for about twelve years and have also been a client of his during this time. His responsiveness, dedication and professionalism are next to none. His personality is very warm, intelligent and genuine. Tony is very focused on providing you with the best advice for your circumstances. I would definitely recommend Tony as an adviser (and friend) to any potential business or individual.’

– Sally Schmidt, Loyalty Director at Xero

‘Tony and his team at AD Partners have looked after all our personal and business accounting needs and our insurance needs since day one. Tony has remained professional, accessible and trustworthy throughout our twenty years of dealings and I have no hesitation in recommending Tony to anybody who needs an accountant of the same qualities that Tony and his team at AD Partners portray day in day out. Thanks for your ongoing support and commitment to us and all our financial needs, Tony. We look forward to many more years working together.’

– Aysun Portoglou, Business Development Manager at Aussie

‘I have had the pleasure of working with Tony now for over ten years and he is, without a doubt, one of the most professional and hard-working consultants I have had the pleasure of working with, both as an accountant and as a client of his, but also as a professional that I have engaged for complex work both in Australia and offshore. I can highly recommend Tony as a professional consultant, and also as an accountant to all; he is someone who definitely embodies the right work ethic and the right qualities as an individual, which are a rare find and combination. Thank you for many years of great and consistent work.’

– Damian Cessario, DLC Capital

‘Tony at AD Partners has shared his experience, expertise and advice, which have been invaluable in allowing me to make sound decisions both on a personal and professional level.’

– Anna Mastwyk, Learning and Development Consultant

‘I have been a client of Tony’s for many years now and have been very happy with the level of service and attention to detail that he and AD Partners have provided. Now also as a client of AD Wealth I look forward to continuing that excellent relationship.’

– Aldo D'Alberto, Business Manager at Polymers International Australia Pty Ltd

‘I have been a client of AD Partners since commencement of their business. Tony has always been very professional, well informed, diligent and very intelligent – nothing is ever too much trouble or bother. I can rely on Tony to help me with everything that needs his expertise; he always seems to have the answer to everything that needs to be sorted out. I feel sure and confident that I will continue to receive his exceptional service and great advice as I continue to require and need it.’

– Rose Tibaldi, Retail Consultant Gandel Group

‘Thank you for the outstanding service you provide with both my professional and personal requirements. You are always on hand to answer my questions, and your staff and management are great to deal with. I have always felt that I am treated like a person, not a number. Thank you, Tony – I have already recommended you to friends and colleagues. After ten years the service hasn't changed.’

– Rosanna Cittadini, Director – Service Tech Australia

‘I have been a client of AD Partners for over 15 years. They have a professional team experienced in all fields of taxation and financial planning. They oversee my investment portfolio to always assist me to achieve the best possible returns.’

– Anthony Craus, Property Developer

‘I have been dealing with Tony and the team for over five years now and am delighted to have them as my accountants and financial planners. They are professional and always there to give credible advice when required. I could not recommend AD Partners more highly.’

– Kel Kilner, National Sales & Marketing Manager at True Foods

‘As a long-time client of AD Partners, I recommend them to anyone and everyone. Prompt, professional and perfect! The 3Ps.’

– Andrew Martin, Director – Room 35

First published in 2017 by Grammar Factory Pty Ltd.

© Tony Dimitriadis 2017

The moral rights of the author have been asserted

All rights reserved. Except as permitted under the Australian Copyright Act 1968 (for example, a fair dealing for the purposes of study, research, criticism or review), no part of this book may be reproduced, stored in a retrieval system, communicated or transmitted in any form or by any means without prior written permission.

All inquiries should be made to the author.

National Library of Australia Cataloguing-in-Publication entry:

Creator: Dimitriadis, Tony, author.

Title: Build it and the money will come : master the 5 secrets to a successful building and property development business / Tony Dimitriadis.

ISBN: 9780995445314 (paperback)

ISBN: 978-0-9954453-2-1 (eBook)

Subjects: Business enterprises--Finance.

Real estate development--Finance.

Real estate business.

Success in business.

Printed in Australia by McPhersons Printing Pty Ltd

Book production by Grammar Factory

Editorial services by Grammar Factory

Cover design by Designerbility

Typeset in 10.5/15 pt Acumin Pro by Independent Ink

Disclaimer

The material in this publication is of the nature of general comment only, and does not represent professional advice. It is not intended to provide specific guidance for particular circumstances and it should not be relied on as the basis for any decision to take action or not take action on any matter which it covers. Readers should obtain professional advice where appropriate, before making any such decision. To the maximum extent permitted by law, the author and publisher disclaim all responsibility and liability to any person, arising directly or indirectly from any person taking or not taking action based on the information in this publication.

I would like to dedicate this book to all the ambitious business owners working tirelessly in the building and property development industry.

I hope that the ideas and tips in the book help you to build and live your dream.

Introduction

‘The secret of getting ahead is getting started.’ – Mark Twain

You are an ambitious business owner who wants to make a mark on the world.

You want to achieve your personal goals, whatever they may be.

In business, you want to achieve financial stability and take control over your business and your life.

You want to live a lifestyle that enables you to have more money in your pocket and more time to use it, in any way you choose.

But how do you do it?

Business is tougher than ever in today’s competitive world with more than 60 per cent of small businesses failing within the first three years, and 75 per cent failing within five years, according to the Australian Bureau of Statistics.

As a result, you need to be as strong as the concrete slab you lay when building. Just like when you’re constructing a building, your business needs to have a strong foundation. You need to have the right people working for you and with you to build your business and your lifestyle.

You face many challenges in your business and they all have an impact on your ability to earn the money to give you the lifestyle you want.

But this is easier said than done. How can you retain your rightful share of the money you earn? How can you effectively manage the cash flow requirements of your business so you can access money when required for development or investment? How can you access financial information in real-time to make informed business decisions? And how do you get your head around the difference between cash and profit; tax, GST, CGT; and ensure your business generates a return on your investment?

You need to understand and accept these challenges. You need to embrace them and face them head on. You can’t afford to bury your head in the sand. You also can’t afford to take shortcuts, and you can’t afford not to get the right people in to help.

Meeting these challenges is the key to the financial management of your business.

Money can be a beautiful thing and at the same time it can be a nightmare. With it, you can do so much. Without it, you feel helpless.

You need money in your building and property development business to invest in land and property. To acquire equipment and machinery. To pay for labour and resources. You also need to fund the project through to completion. Then, at the end of the project, you would definitely like to have some left over – the more, the better.

Without money, the project, no matter how big or small, will suffer. In the worst-case scenario, it won’t even get off the ground.

Your money needs to be managed correctly, right from the beginning. If your business is not structured right so it suits your particular situation, then you are destined to lose money from day one. The wrong structure will mean that, even after all your hard work building and developing, you will give up to half of your profits to the government. I don’t think you want that to happen. Do you?

Worse still, without the right structure and foundation for your business, all your personal assets will be at risk should something go wrong. Many unforeseen circumstances arise and you could be exposed and potentially lose it all.

Like money, with people, you can do so much. Without them, you can feel overwhelmed, trying to do everything yourself.

People are great, but only when you have the right ones around you to provide support. This isn’t the case when you don’t. With them, you can achieve so much. Without them, you run out of power or battery, just like your favourite trusty drill.

When you are working on a job in your building or development business, I am sure that you get the right specialists for the parts of the job that are outside of your specific expertise. Even if you have the expertise, you want to have someone else do that particular part so you can concentrate on something else.

Well, it should be no different when it comes to the financial management of your business. If you do not have the expertise, then you need to get it yourself or someone who does.

Ask yourself: do you truly understand financial reporting? Do you understand the difference between cash and profit? Do you understand the difference between income and capital? Do you understand your return on investment? Do you understand tax law and compliance? Are you planning and budgeting? Are you managing your cash flow?

The reality is you need a high level of financial intelligence to be able to be successful in business today, and likely even more so in the future.

You need to find the right people for the job. If I want to build a house or develop a block of land, I will go and find the right person to help. Someone just like you. If you want to optimise your business’s finances, you’ll need to do the same.

Build it and the money will come

In this book I will teach you how you can better financially manage your business so that you have more money in your pocket to fund the lifestyle you want.

You can achieve this by following five simple steps, each outlined in the book’s chapters:

Strategy: The first step in any journey is deciding where you want to go. In the first step of my framework, you’ll create a strategic plan by assessing where you are now, deciding where you want to go, and charting the most efficient course between the two.

Structure: The right structure can save time, money and heartache. The wrong structure, on the other hand, can make your business far more expensive and complicated than it needs to be. Structure is an essential piece of achieving your strategic goals, so in this step I’ll outline what you need to consider when it comes to choosing the right structure for you.

Statutory: Are you aware (and on top of) all of the obligations you have to the Australian Taxation Office (ATO), Australian Securities and Investment Commission (ASIC), State Revenue Office (SRO), Land Titles Office, WorkCover Authority, your superannuation provider and your bank? This is a major stumbling block where businesses in building and property development can unwittingly subject themselves to fines and liability. In Chapter 3, I’ll cover the main obligations you need to be aware of as an ambitious business owner.

Systems: If you are trying to manage everything by yourself on an ad hoc basis, not only is this inefficient, but you run the risk of not meeting your statutory obligations. In this step I’ll share the main money management systems your business will need to stay on top of your obligations, while moving towards your strategic goals.

Support: As an ambitious business owner, you probably try to do it all. After all, it’s your business – you want to make sure everything’s running as it should be. The problem is that this isn’t sustainable – you can’t be all things to all people, and you can’t do everything at the high standards you’d like. This is why support is essential. In Chapter 5 I’ll teach you how to find the right support team to help you implement the first four steps of the framework, while pushing your business on to bigger and better things.

In these five steps, you will find all the tools you need to grow a financially rewarding, tax-efficient, lifestyle business.

Who am I?

My name is Tony. I am a Certified Practising Accountant (CPA) and have successfully run my accounting practice, AD Partners, for over 15 years. We are based in Melbourne; however, we have worked with many businesses across Australia.

As an ambitious business owner myself, I very clearly understand the challenges you face as I have experienced some of them myself. I know how it feels when payroll’s due, but you’re still waiting for a big payment to come in. I’ve had the difficult conversations with staff members about not delivering work on time, or to the standards we need. And I get what it’s like to feel like you’re