I remember when 9-11 happened and the tremendous shock that resonated throughout our country. The pain felt for all the lives lost. The fear that an enemy could attack us the way they did. The crash of our economy and the uncertainty of what was ahead. President Bush told America that the stock market was, “on sale” , and it was a great time to invest. At the time, I remember questioning that. However, I now understand it and embrace it.
Fast forward to today and I am feeling a lot of the same feelings. Economically, we must embrace a new normal. Small business owners are now adapting to these changes. I have been watching it across multiple industries and many have surprised me by their creativity. Learning to look at things differently and adapting to change can be very beneficial to the small business owner.
I can’t help but wonder if this is a good time to consider small business buyouts. Would this be a beneficial growth strategy? We hear about this all the time with large corporations, but is it smart at the small business level?
Acquisition of a Small Business
According to McKinsey, “acquisitions as a growth strategy can be used to meet many business goals. A business owner may want to acquire a competitor and consolidate their market. It may also make sense to acquire a new product, which you can then scale. It may be faster and cheaper to acquire a competitor that has better technology, so you don’t have to build the tech yourself. Lastly, you may identify a business that you believe you could grow substantially and turn into a winner. All of these strategies should be on the radar for small business owners who want to grow their companies.”
Identifying a business you believe could grow right now, after we are through this COVID-19 pandemic, may be a smart move for your company.
Do you have a company in mind? Start with a solid plan and investigate. Investigative due diligence refers to the research and analysis of an individual or organization done in preparation for a business transaction. A proper due diligence check list covers corporate filings, finance, operations, management and employee health, just to name a few. This occurs after preliminary discussions have taken place between the parties involved.
Online Background Check
But, sometimes things are not always as they appear to be. Conducting a thorough online background check on a business and key owners/executives may either give you the confidence to move ahead or justify a pause to collect more information.
More and more documents are stored online and are open sourced; you only need to know and understand where to look.
I will be writing more on this subject in the weeks to come because I think it is valuable information right now. We are seeing a rise in this type of online research and if you would like to discuss this further, please feel free to reach out.