By Suzanne De Lucia CBI, Fellow Of The IBBA

After 20 years as a business intermediary, I finally did it, I bought a business. Now that I have a solid six months of ownership under my belt, I would like to share the experience.

From the beginning, it’s been a fantastic journey. The business, a food manufacturing and distribution company, came to me as a potential listing last November 2008.

I first looked at the business through my intermediary eyes and identified all of the benefits and pitfalls. On the plus side, the business had a proprietary product, which was actually quite good, it had increasing sales, it was account based, with little customer concentration and it was both under managed and expandable. On the minus side, the business had some of the worst books I had ever seen. My first comment to the seller concerning the financials was “this is not possible”. I spent two full days creating my own P&L from scratch.

By the time Christmas 2008 rolled around, I had listed the business and was planning to go to market at the first of the year. If you’ll go back to that timeframe, things were not pretty in the national economy. As I had no direct experience in the food manufacturing industry, I was quite worried about my ability to truly operate the business as well as the time commitment it would require.

Miracles do happen and a perfect partner materialized who could run the day-to-day operations and make up for my lack of experience in the industry. I went to my seller and made known our intent to be considered as a buyer. Fortunately, we were given the first shot at a purchase.

This is where things got tricky. By this time, the economy and stock market were in full plummet. I got to experience every doubt and sleepless night that buyers face. Would the economy continue to drop? Was I overpaying for the business? Does the product have staying power? Will our biggest customer drop us? Are our prices too high for the times? All of this had to be balanced with the fact that I still had an obligation to the seller. On top of it, I was bringing in a partner and worried about risking his financial future and mine.

The very week that I was putting my finances together was the low point of the stock market. I decided not to raid my accounts, but to get my money out of my home equity line. Every day I watched the account, fearful that my line would be pulled by the bank. It all worked out and the closing occurred. I have to say that mine was the fastest and least painful sale of the year.

It’s been a whirlwind since the acquisition. There just aren’t enough hours in the day for the demands of two businesses. While it’s been an enormous task to systematize and grow a new business, I’ve gotten to put everything I’ve learned about small business management into practice.

There have been some unexpected benefits for our brokerage firm from owning the food business. First, the new business has introduced me to many industry people under a different pretext. I naturally let them know about the business brokerage services I can provide and some benefit in this area has already been realized. Secondly, I am able to share my stories as a business owner and acquirer with buyers and sellers and relate to them differently than before. I have walked the proverbial mile in their shoes. I believe this helps to develop a better relationship, which is so needed in getting deals done.

All in all, it’s been a rewarding experience to purchase a business. As an intermediary, I always identified potential areas of growth and improvement for the businesses I represented. As elementary as this may seem, it’s much easier to identify potential than to realize it. I also have a better understanding of buyer concerns, starting with the offer process and going through closing, and eventually operating the business as ones’ own. It’s been a challenging and eventful journey, but I wouldn’t trade the experience for anything.