Crunch time

[lwalton]

I may have asked this before on the forum but here goes anyway, I have worked for a company for 16 years on the tools and have recently gone into the office, the time has now come that the owner wishes to sell the company and I proposing a management buy out. Now hears the pickle the other two managers only ever have two engineers working for them where as I have nine! The company also has a few debts that we would inherit, the company has massive profit potential but given the debts and lack of drive from the other two managers am I just better going on my own and building my own company? All people around me have there own agenda as many of my friends work for the same company hence I am after some impartial views. Thanks lee

[xvivalve]

A management buy out is only generally successful when the managers who buy have similar aspiration and attitude. You'd probably find yourself doing the lion's share of the work for only a proportion of the benefit.

You really don't want to start off by paying off someone else's debts, nor should you relish inheriting the liabilities they have built over recent years.

If I were you, I'd set up on your own and in due course take the pick of the nine who currently work for you as the enquiries build.

I set up on my own 12 years ago this month, and was flattered to find which clients actively sought me out and gave me work; I've never looked back.

[sprint95m]

I agree with Alun,
set up on your own Lee.

Trust me, fighting against deadwood will wear you down.




Ian.

[lwalton]

They just want to cream off the top for a few years then retire themselves, I think the best move as you say is to go on my own as I am already getting peed off with one manager having up to 8 cigarettes each day each taking around ten minutes then walking back in the building and bringing the smell in with him. I will however need to save for a van etc ready for the jump!

[sprint95m]

I have no direct experience of this Lee,
but it may be worth enquiring with your local enterprise body what funding/start up help is available.
Some of this could be by way of a grant or a "soft" loan, but (perhaps more usefully) they may provide assistance
with attending business management courses for newcomers.



Ian.

[SprintMWU773V]

I set up on my own as at the time it was more convenient and I got a better deal by being SE. I've actually gone back to being employed at the moment, partly because it's extremely time consuming looking for new projects and partly because I'm not really in the mood for working for myself right now.

Would I become SE again? Yes probably, just not right now. There's a lot of support out there, some better than others, all depends on the type of business.

[lwalton]

It is an electrical contracting firm, I really want the company to work but there are too many people taking out of the pot. I am looking at about 10k to set up on my own van, tester, insurance, membership of nic etc which I can save by Christmas I just hope the firm Carey's on until then. The only thing in my mind is that there will never be a good time to make the jump, there will always be something I need to pay/save for that I will use as an excuse

[Jon Tilson]

Agree with what's been said about deadwood, but the alternative to unemployment can be a huge motivator.

I would discuss the buyout with the other 2 managers. They won't want to be on the dole with no prospects and a diminsihing pension pot.
If you can offer them a better alternative with a management buyout that they also "buy" in to and get pension rights maintained for an increase in effort if I was in their shoes I know which way I'd jump....

and it would be hanging on to your coat tails.

They may be old and seem a bit demotivated, but I bet there is some experience there you could do with.

Just make sure you don't pay health insurance on Mr Fagg Butt.

Jonners

[matienzo]

If your are worried about some members of management then you have answered your own concerns. It sounds like you will never have complete trust...which is a show stopper.
If you are confident that you can withstand a lean period whilst getting setup and can put up with doing all the admin as well as the actual graft, then self employed is the way to go. If you speak with existing clients then they will know what your doing and you'll probably get options on work almost straight away.
After that its up to you to nuture good client relationships and a quality service, which is what will bring you success...eventually.
Good luck.