Buying A Business
How to Keep or Let Go Existing Employees After Buying a Business
It’s almost expected that current employees will be wary of new management. And their fears are valid. Are their jobs safe once you take over? Even if so, are you bringing in new employees who could disrupt the flow of things?
Business sales spark fear of layoffs, inconsiderate new owners, and significant procedural changes. Ultimately, the best thing you can do is be as transparent as possible, even in worst-case scenarios. The following tips will help you have a smooth transition and ease existing employees after buying a business.
How to Manage Existing Staff When Buying a Business
Earning your new employees’ respect is important, but you’ll also need to earn their comfort. Scattered employees will make for a scattered workplace, and that’s the last thing you want to deal with after buying a new company. Assuming you want to retain the existing employees, the advice below will help curb that.
1. Meet with Key Employees
You should try to meet with as many employees as possible — not just higher-level management and other decision-makers. The best-case scenario would be to have face-to-face meetings with each department on its own, so they have room to discuss their specific concerns, and you can find what motivates them. If employees work remotely or your staff is too large to do this productively, you could create a sample size of employees from each department. Your managers could point you to who to speak to. Once there, you should use this opportunity to begin relationship-building so your new employees start to trust you.
If your team is remote, it is still of high importance to meet with employees virtually. This is an even more delicate situation, but ongoing communication can help reduce anxiety and uncertainties!
Money isn’t everything — but it’s up there. Now would be the time to evaluate your employee’s salaries and see if there is room for improvements. This may sound extreme, but retention is of the utmost importance in today’s job market. Salary is a non-negotiable when it comes to their satisfaction. Generous and thoughtful leaders have a much better chance of keeping their employees, so bear in mind the type of long-term investment this would have, i.e., less time and resources spent on recruiting and training!
3. Respect What’s in Place
A little humility can go a long way when acquiring an existing business. Of course, it is your job to lead, but that doesn’t mean that your input and expertise are all that matters. After all, these people have been with your company a lot longer than you have and will most likely have good insight. Perhaps, the former owner didn’t take their considerations seriously, so you may not even be aware of their thoughts and feelings towards specific processes.
As we mentioned before, it’s important to find out what is and isn’t working, and if they identify pain points, it would be in your best interest to listen. On the converse, if they’re happy with a process or operation, it may not be the time to make a major adjustment unless you can really justify doing so.
4. Getting Their Sign-Off
For any adjustments that affect your employees, especially regarding their salaries, benefits, or general terms of employment, you’ll need to get their approval beforehand. If not, you could be sued for breaching employment contracts. Even if a particular detail seems small, it could make a difference, so playing it safe is always your best route.
Knowing When to Let Go — and How To Do It
It’s unpleasant. But, new business owners have to be brave and smart enough to know when to let go of underperforming employees.
From a managerial side, you’ll want to review what contracts are in place for the particular employee(s). (Now would also be a good time to consider setting up non-competition contracts for employees you’d like to retain.)
You should also be extremely specific about why you’re letting this person go and make sure your reason checks out.
Try to end on a positive note, and if you can, help find new employment. Also, consider the impact this will have on existing employees. You should work quickly to replace this role and reassure your staff that their jobs are safe.
Determining what to do with existing employees after buying a business is one of many considerations you’ll have to make. For the things that don’t have to fall back on you, you can depend on Sunbelt Business Brokers. We’ll step up and navigate much of the business buying process for you so you can prepare for what’s ahead. Locate your nearest office to get started!