After the business sale: Do’s and Don’ts for new owners

Taking a new business under your wing is an exciting prospect. It’s understandable you are itching to make your mark on the business. The acquisition process may have taken several months to complete. As a result, you have a long mental list of all the things you would like to change or implement.

So, let’s get started on day one!

If this is where you’re at, there’s something you need to hear…

To change everything on day one is the worst possible action you can take for the future success of your business.

Taking a new business under your wing is also a potential ticking time bomb. Those first few weeks post-sale are critical. Make one wrong move, and you could jeopardise the stability of your team, customers and suppliers.

In this post, we share our essential do’s and don’ts for new owners who have recently acquired a business. We explain the areas to take action and where you should rein in your enthusiasm. Our advice and recommendations are based on 45+ years’ experience of brokering business sales and the problems clients have encountered after the sale.

We should add, please don’t follow these tips if you have bought an under-performing business, as alternative advice may apply. Contact your local business broker for guidance.

What is the impact of a change in business ownership?

Change leads to uncertainty. It’s a natural reaction. A change in business ownership comes with uncertainty and risks destabilising even the most profitable of companies. When you acquire a business, you must show that you have the best interests of that business and everyone involved in it, at heart – at every stage of the deal.

Interested in acquiring a business near you? Browse current businesses for sale in your region

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Do’s for new business owners

DO introduce yourself to your new team

This may sound basic, but it’s the simple things that are often overlooked. New owners can be obsessed with big picture strategy and fail to get to know the people who are fundamental to day-to-day operations. Take time to walk around the business and meet the people that make it tick. It’s your opportunity to make a great first impression with everyone from the canteen staff to admin support.  

DO take time to learn the business

Acknowledge that you are new to the business, and you don’t know everything about it. Immerse yourself in its operations. Talk to the management team. Ask for their views on performance. Learn its processes, systems and procedures. Understand how everything works and the way things are done. You will soon get a good idea of what is working and what needs to change – which might not match your initial thoughts. 

DO nurture existing relationships

As well as getting to know your employees, you need to nurture the other relationships that keep your business afloat: suppliers and customers. Both these groups will be looking for stability under new ownership. Reassure them that the current service they receive will continue under your watch. 

DO make a plan

Set out your intentions with realistic timescales, so that you can clearly communicate your vision for the future to your employees, clients and suppliers. Share issues that need to be fixed straight away and your reasons for doing this, e.g. if you lost a key employee during the sale and need to replace them. You won’t be able to change everything at once (and it’s not advisable to do so). Drawing up a physical plan can bring to life what is achievable.

DO consider the implications before making changes

Put your big picture hat on and think about the people, systems and outcomes that will be impacted by your decisions. This may mean taking professional advice from a lawyer, accountant, or another expert.

One of our Business Partnership Brokers supported the sale of a coffee shop. After the deal went through, the new owners began changing things immediately. What they considered to be small details turned out to be huge in the eyes of their customers. They changed the background music, the menu, even the mugs! Despite holding the same volume of coffee, customers perceived the smaller mugs to hold less coffee and therefore offer less value. It’s a lesson that all decisions, no matter how minor, have repercussions.  

DO involve stakeholders in decision-making

In the example above, if the coffee shop owners had involved their customers in the conversation and perhaps asked for their feedback on the proposed changes, the outcomes would have been different. As well as customers, consider the views of other stakeholders, including shareholders and employees. Allow people to have their say and demonstrate that you are actively listening to their views, not making a token gesture.

Have you identified a business you would like to buy? Ask how we can help secure the deal

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Don’ts for new business owners

DON’T hurry to make major decisions

Take your time to review the implications of your actions, and consolidate and review the feedback you receive. New business owners need to build trust and confidence in their leadership before making any major changes. Tread carefully.

DON’T ignore valuable opinions

Going back to the coffee shop example, if the owner had consulted with customers and the customers overwhelming responded that they didn’t like the new mugs, the owner could not ignore this. The same goes for professional advice. Asking for feedback and then ignoring it would be foolish.

DON’T cut ties with the previous owner

Sweeping away all traces of the previous business owner once the deal is complete would be a mistake. Whether there is a handover period agreed in the deal or not, you may still need to ask the previous owner important questions. Keep your relationship amicable.

How a business broker helps you buy a business

When you appoint a broker to help you buy a business, you benefit from plenty more advice like this. Before, during and after the deal, a broker supports you to ensure you make informed decisions at every stage. Whether it’s your first or fifth acquisition, our national network of brokers has the know-how and experience to set you on the right track. From where to start to post-sale, our brokers will help you to integrate yourself into the business and make the right decisions for its future.    

If, during due diligence, you identify things that need to change under your ownership, our best advice is to hold that thought. Take a step back, follow our do’s and don’ts, and take your time to get to know your new business before you make any changes.