Q: I’ve just bought out a small systems contracting firm. As a new business owner, what is theone thing I really need to know?
A: The hard part of this quesition is there are many things to know as you take the helm of any business. Thinking back myself, and hearing from other contractor friends, they all seem to attribute their success to the people who either worked for them, or who mentored them as they learned the business. Some even commented that they knew exactly whatnot to do having watched former bosses. So, certainly surrounding yourself with hard-working, knowledgeable and honest employees and having good outside advisors (legal, accounting, tax) is a big thing.
If I can add to this answer, I also think having a focused and strategic business plan combined with a personal drive for success makes a huge difference. I spoke recently to a member who only started his business because he lost his sales manager job with another integrator. He basically hates it. He can’t sleep at night, can’t stand the pressure of meeting payroll or being responsible for the livelihood of others.
You will have good days and bad days. Make sure that you always keep an eye on your own attitude and motivation as it directly links to your ability to lead others. If you aren’t a natural leader, let us help you learn to become one. Just deciding what to do the same way as the prior owner or what to do differently isn’t enough. Things change.
And one final thought… Many of our members that have failed over the last few years got caught in a cash flow and financing bind. Under-capitalization and managing receivables is a big challenge right now. As the new owner make sure you carefully monitor project size and scope, how billings and collections impact cash flow and borrowing. Carefully watch for any excessive spending on vehicles, buildings, tools, test equipment, etc. Don’t let your employees convince you they need something you can’t afford if they can’t prove the payback. I guess there truly isn’t just one thing — CW