Crucial Next Steps to Take After Buying a Business
You’ve finally closed the deal and bought yourself a business. Congratulations! Now, pay close attention to what you do, and don’t do, these next few months. This time is critical for a smooth transition, regardless of whether or not the previous owner has stayed on to help out.
The last thing you want to do is come in on day one with major changes and completely disrupt the environment. Your new employees have just undergone a major change and rippling the waters even further can be detrimental to how you are viewed as their new leader.
To ensure a smooth transition for you and your employees, take our advice and follow these next few steps:
Introduce Yourself
Depending on the nature of the transaction, you may or may not be retaining all of the employees. To the ones who remain, introduce yourself. Tell them all about yourself, why you bought the business and your vision for the future of the business. Get to know a little about them and let them know you’re there for them.
Reassure Employees
After the initial introduction, set up individual meetings with all of your employees, or at least the key employees, who will no doubt be feeling a little nervous and uneasy about their future with the company. Put yourself in their shoes and imagine the fear you would be feeling, worrying about possibly losing your job. That’s exactly what they’re going through. Explain to your employees about the changes that will or will not be made to the business’ practices. Reassure them and answer any questions they may have. Make the most out of this information-gathering time you have with them. Pick their brains on suggestions they may have about their own positions as well as the business itself.
Understand the Business
Before you come in and make sweeping, drastic changes, take your time and get to know all of the intimate details of the business. Develop a strategy, or action plan, that starts with implementing minor changes first. Think of it as baby steps. There will be time for bigger changes down the line. Maybe get to work on a two-year, month-to-month cash flow forecast including the cost of what you plan to change and when.
Reach Out to Vendors
To avoid customers hearing about the sale from a third party, reach out to them yourself and let them know about the change in ownership. Just like with the employees, reassure your customers and answer any questions they may have. They are, after all, your bread and butter, so the better they feel about things, the better it will serve you in the long run.
Take Care of Important Odds and Ends
It would be smart to open a new business account right away. By doing so, you’ll clearly be able to discern which transactions took place before and after the sale. In addition, provide the bank with a copy of your business’ legal filings or incorporation papers. After that, obtain a federal tax identification number. This is also the time to sign the lease or confirm the terms of the rental agreement.
Keep the Lines of Communication Open
Lastly, let your employees know that your door is always open should they have any questions or concerns down the line. In times of change and uncertainty for your employees, show them the transparency and leadership that will serve them and the business well in years to come.