What Happens After You Buy a Business?
There should be no surprises after youif you thoroughly studied and investigated the business. What you should do now is to smoothly go through the transition phase as the new owner, and with the right decisions and actions, the business will thrive.
After You Buy a Business …
1. Maintain the status quo for now. Avoid disruptive changes that may confuse the staff or customers alike. Gradually introduce changes and see how the employees and customers react.
2. Hire the former owner to stay for a pre-determined period during the transition phase as your adviser or consultant. He or she can guide you through the daily operations of the business. Observe, listen and ask questions. The seller can introduce you to the employees, customers, suppliers and the landlord. The presence of the former owner adds the much-needed stability, especially as far as the employees and suppliers are concerned.
3. Learn the ins and outs of the business. Talk to the employees, customers, suppliers and business executives in the same industry. Know how the company is currently run. Review the policies and systems in place so you can make amendments or revisions if needed.
4. Meet with the employees about the future of the business. Seek their support and assure them of their job security. Get their feedback and suggestions on how to improve the products or services that the company offers and how to build the business. They will be more effective workers if you involve them in drafting policies or improvements. They will feel they have something at stake in the company. Let them get to know you and vice versa. Be available to answer their concerns.
5. Introduce yourself to the customers as the new owner. Get their suggestions on how you can improve the company’s service or how the product they are patronizing can be improved. Tell them to expect the same or a better service. Ask what they want so you can meet their demands. You can offer special discounts or give promotional gifts to earn their good will. Make them comfortable so they continue buying your products or service.
6. Familiarize yourself with the suppliers of your raw materials, equipment and products. Find out if there are concerns that need your attention.
7. Advertise, send letters or distribute flyers to the customers. Let the public know that the company is under new management; that they can continue to expect the same or better service from your company. Update the company’s website, and display new management banners for a few weeks.
8. Develop a business plan. Make plans for the expansion of the business or improvement of its current operations.
9. Lead by example. Work diligently and efficiently so the employees can follow your example. Keep your work area clean. Be economical in the use of the business resources such as office supplies and utilities.
10. Manage the inventory and observe purchase expenses. Equipment should be regularly checked and maintained to avoid breakdown and unexpected expensive replacements. Dispose unproductive and unwanted inventory, equipment and assets that just take up space.
Develop friendly relationships with all who deal with your business – the former owner, employees, suppliers, customers, landlord and creditors. Carefully study changes that can have long-lasting consequences. Explain why these changes are necessary so you get their cooperation. Will you do well as the new business owner?