QUESTION ON Business Opportunity For Employees
I work at a high-end cabinet shop and been there for 11 years with five other coworkers that have been their for just as long or longer, and are all very good friends. It’s a family owned business for 25 years. The owner is, lets just say not very smart! The only reason he has lasted this long is mainly of one man who he has been with him since day one. He engineers, drafts the jobs talks to customers & contractors make sure everything on a job is going to work. And when customers or contractors need an answer they call him. They do not like dealing with the owner because even though he has been in the business for so long, half the time he don’t know what he is talking about and people pick up on that very quickly. One day last week out of the blue we were informed that he sold the company and we would be part of a merger with another shop. Everyone has a very bad feeling about the deal! and no one will give us a straight answer about our future.
And let me just say this before I get your advise. EVERYONE says, even the owner himself, that the six of us are what makes the COMPANY not the owner, the building or the machines. We have been told by a few of our contractors and customers that wherever we go they will follow. So the six of us has been kicking around the idea about starting are own High End cabinet shop we all would be equal partners. We found a building with all the tools and machinery we need for lease pretty big enough for us. We also have a few financial backers and as I stated before customers and contractors with work to get us started. We are going to get together next week to discuss going forward or not. Do you have any advice to help us?
Advice by Tammy Harrison
I commend you and your co-workers for working in a job that you love! Most people, these days, find passion outside of their job instead of loving what they do so that their passion encompasses their whole lives!
Family businesses are very difficult to work with, unless you’re one of the family! For over 10 years, I worked for various family business and was always involved in both the professional and personal aspects of the relationships – just because their work was intertwined with their personal lives. Sometimes it was great and sometimes it made me anxious and working conditions were strained.
This is also the first place you need to look when deciding if you and your co-workers can create a business together. I say this because it’s real easy to go to work, do your job and go home. But, there are dozens of daily tasks that a business needs to survive and thrive. One of those is the interpersonal relationships of those involved in the business. When the success of the company is on the back of a single owner, the employees do not have to bear some of the responsibilities of such. But, when six people try to run a business together, the allocation of work has to be agreed upon by all and each one has to do their job as well as assisting with the work of the others in the group. You have to do more than just get along, you have to have trust in the abilities and actions of everyone.
When you sit down with your co-workers next week, you need to make a list of the areas of expertise that are needed to run a business and then determine who will be in charge of those things. These are just some that come to my mind:
- Finances / Accounting – who will handle the money issues?
- Marketing / Advertising – who will handle getting new customers?
- Quality Management – who will make sure that the product is of high quality?
- Customer Service – who will handle the customers
- Manager – who will deal with the daily management of the shop?
- Purchasing / Inventory – who will be the buyer for the raw materials and equipment you need?
It’s not that you change your ways and everyone only does one thing – they have to do their normal work as well as hold a role in the management of the company. They have to be responsible above and beyond what they do now. And the entire group has to trust each other way more than just making sure you have safety glasses on!
The main reason couples in a marriage have issues is usually because of finances – and the same thing happens when two or more people are involved in running a business. You and your co-workers need to have some serious discussions about money, so you can put down on paper the ‘what ifs’ and the solutions. For instance, what if the marketing manager isn’t doing his job and you don’t have another job to do – money will be tight and how is that going to be handled? What if the finance manager hasn’t kept up with the accounting – what steps will be taken to make sure that’s finished? What if a co-worker dies or wants to quit – who will decide if they want to buy him out or find another to replace him? The main issues of a business need to be decided upon and put into your contract – you all must start on the same foot and walk together to be successful.
You may do very well if you could find a SCORE counselor in your area, to help you get the business put together and off the ground on solid footing. I know of a super guy in the Kansas City area who does this, but you can find listings for them at http://www.score.org . These are usually retired business owners who offer to assist others with their business expertise.
And, don’t forget your spouses in the decisions you make. Each person has to have the same level of trust, not just for the other co-workers, but also in their spouses. Easier said than done, I assure you!
I wish you the best and let me know if there’s any other questions you may have!
Recommended Resources on Mergers and Acquisitions
- Mergers and Acquisitions For Dummies
- Creating Entrepreneurial Supply Chains: A Guide for Innovation and Growth
- The Complete Guide to Mergers and Acquisitions: Process Tools to Support M&A Integration at Every Level (JOSSEY-BASS BUSINESS & MANAGEMENT SERIES)
- Financial Exits: Sell your business for a high EBIT multiple
Tammy Harrison is a successful home-based working mom for over five years. She holds a degree from Mizzou in Consumer Economics. Her business focuses on Marketing and Creativity for Small Businesses as well as numerous other small businesses.
Category: Q & A