You have just closed on your acquisition, and it is time to combine the newly acquired assets with your business. This is an exciting time for you and your employees and a critical time to assure the success of the transaction. Remember, it’s not the customers you buy that are important; it’s the customers you keep that will make the acquisition successful.
There are many aspects to a successful transition. Some items you will need to address are the employee announcement, informing customers (or not), hiring employees, transferring account info, payment processing and vehicle registrations to name a few.
When the employees of the acquired company learn about the sale, they will be nervous about their future. I recommend holding a meeting with all the employees you intend to hire. In the meeting, it is helpful if the seller thanks them for their service to the company, explains the reason for the sale and shares what he knows about the new owners and why they were the successful buyer.
As a buyer, it is important to let the employees know about your company and why you acquired the business. Assuring them that they will have a job is obviously important. I recommend having new employee paperwork available to be completed the day of closing. It is recommended that as part of the packet you include a non-solicitation agreement as a condition of employment. This will protect your investment as employees will typically be restricted from soliciting customers or employees if they leave your employment. Discuss this with your attorney for more details.
To send a welcome letter to the newly acquired customers, or not, is a common question. Every situation is different so let me share my observations. If the acquired company will operate under the same name, from the same location with the same phone numbers with fuel and service delivered from the same vehicles and no change in billing processes, then it is less important to send a letter. If the acquired company will move the customers into their existing operations, then a letter may be recommended. A well written letter explaining the benefits of the combined businesses can be very positive. I recommend using a professional company to help craft the letter; it will be worth the investment.
Transferring account information is a key element to a successful transaction. Many larger transactions transfer account information electronically. This can be a complex process as different systems use different customer code fields, which will need to be mapped over properly. Another option is to manually add the information into your systems. It takes a little longer, but you tend to get info in the format you need it.
Payment processing is an item that also needs to be addressed. Many customers are on an automatic credit card payment and the payments will need to be transferred to your account. Make sure your processor is notified quickly to avoid customer deposits going into the wrong account. Tracking payments is important to keep the accounts receivable balances accurate for both the seller and the customer.
It is an exciting time in our industry as we are faced with many challenges. Some companies will be unable or unwilling to face those challenges and other companies will continue to grow and prosper, many through acquiring businesses. Regardless if you are exiting a business or growing your business, the process should be one in which both parties walk away satisfied.