My Experience Buying a Business in Australia from South Africa
My Experience Buying a Business in Australia from South Africa
Australia and South Africa might both be in the southern hemisphere, but they differ significantly in culture and visa requirements. Moving from South Africa to Western Australia is a big decision, and doing so while buying a business adds another layer of complexity.
For foreigners looking to buy a business in Australia, the process can seem daunting. Understanding the requirements and coordinating all the steps can be stressful.
To shed some light on this experience, Bsale chatted with Erika Engelbrecht from Blue Lizard Gallery & Framers about her journey of purchasing a business in Western Australia while living in South Africa.
What made you decide to buy the business?
The driving force behind my decision was the WA State-Sponsored Business Visa requirement at the tome. The business on offer met all the necessary criteria, and my personal passion for art made it a perfect fit.
Where was the business located when you bought it? Where were you located?
The business was originally located in Joondalup, Western Australia. At the time, I was living in Applecross, WA, which was about a 45-minute drive away. However, I purchased the business while living in my hometown in South Africa. I am now based in Brighton Business Park, Butler, in the northern suburbs of Perth.
What are three pieces of advice you would give to someone looking to buy a business abroad?
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Conduct Thorough Financial Due Diligence: Ensure a thorough financial due diligence is done, and then get a second opinion. Have your accountant verify the BAS figures against the bank statements to avoid any discrepancies. Businesses might be presented positively, but that’s not always the reality.
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Review Break-even Analysis: Request a breakeven analysis for the past three years and review it with a skilled financial analyst to understand the financial health of the business.
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Clarify Profit-Sharing: Make sure you fully understand the profit-sharing arrangements, as they can be misrepresented. Don’t hesitate to ask for detailed figures or seek professional help to interpret them.
How did you ensure your success?
To ensure success, I diversified my approach. I realized that this large investment required support from my family, faith, forward-thinking, entrepreneurship, vision, resilience, and tenacity. I adopted a stewardship approach toward the business.
Building relationships with local artists was key to ensuring a variety of beautiful art was displayed for clients in the gallery. This focus on connection, culture, and community became central to our gallery's identity. We continue to welcome local community groups to meet our artists and watch them work.
What were some challenges you faced along the way?
One major challenge was the misrepresentation of the business’s financial capacity. Although it was advertised as a gallery, it had very little original artwork and mostly prints of classics. This motivated me to partner with local artists and re-establish it as a contemporary gallery.
The previous owners recommended continuing their manual management systems, but after a year, I went digital. This change saved both money and administrative time.
The location also proved unsuitable in the long term due to a strict rental agreement and high rent. Additionally, a busy neighboring tenant closed within three months, drastically reducing foot traffic.
As a foreign business owner, I felt taken advantage of, and I know others who had similar or worse experiences. However, I planned a recovery, relocating the gallery and framing business. My clients followed, and our new premises by the sea became a haven for arts and culture.
We continued to diversify, opening an in-house café, hosting local business events, book launches, school excursions, art classes, and aged care events. Partnering with other local businesses, we’ve built a true community. The business has evolved significantly, and I’m proud of what we've created.
The Lessons
Buying a business as a foreigner is a big decision and we’d like to thank Erika for sharing her story with Bsale. Her experience offers valuable lessons for anyone considering buying a business, whether locally or abroad.
Tags: buying a business foreigner immigration
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 ...
