Buying a business is a huge step in the life of an entrepreneur. On top of managing your existing company, you now need to integrate a new one, while ensuring that both businesses operate without disruptions. The first months after the acquisition are crucial for the successful integration of the new. You need an action plan to avoid missing on essential steps.
Here is a must-do list during the first few months after an acquisition.
- Meet your new people
A change of ownership is a nervous time for employees. That’s why communication is critical. As soon as possible, hold a group meeting with all of your new employees. If your company operates in multiple locations, consider a virtual meeting, through video-call or web-conferencing. People need to hear the same thing together so that the message doesn’t get misinterpreted around the company.
In the mind of many employees, mergers and acquisitions translate into layoffs. Use this first meeting as an opportunity to put people at ease and reduce their fears. Talk about who you are and what your vision is for the business. But don’t promise more than you can deliver.
- Introduce yourself to customers and suppliers
A change in ownership might be seen by competitors as a sign of weakness, Think carefully about how you want to introduce yourself to customers and suppliers.
In some industries, it doesn’t matter who owns the business, as long as it’s business as usual. However, if you’re planning changes or will regularly be interacting with key customers and suppliers, you should make sure to call and meet them as soon as possible. In an ideal situation, the previous owner will help smooth the way during the transition period by introducing you to external partners.
- Seek to understand the business
No matter how well you’ve done your homework and due diligence before the acquisition, you won’t fully understand how a company works until you run it. You have to perform a high-level, non-invasive examination of the business, using a specialized consultant or even your accountant to help you. Look to broaden your knowledge by answering some basic questions, including: Are things operating as efficiently as you thought they were? Is the company achieving the financial results you thought? If not, what can you do about it? Avoid significant changes in the early stages; there may be pressing issues you need to address quickly.
- Focus on your strategy for the business
When buying an established business, you are also buying the previous owner’s way of doing things. It doesn’t necessarily mean it’s the right or the best way of doing things just because someone did it that way for 50 years. Consider how you want to run your new business and then build an action plan. As well, start working on a two-year, month-to-month cash flow forecast with the new expenses built in, such as loan payments for buying the business, increased salary levels and the cost of what you plan to change.
- Leave your door open
Ultimately, buying a new business and integrating it with your existing one is a complex exercise in change management. Don’t be surprised if people still have questions after a few months or are resisting change. Your best ally to fight uncertainty and win people’s trust is to communicate often and ensure you’re transparent, open and approachable.