The First 100 Days After Buying a Trades Company

Short answer: A trades acquisition breaks after closing in six places: the technicians, the customers, the license, the founder handoff, the cash, and the systems. The rule for the first 30 days is to change almost nothing anyone can feel. Use days 31 to 90 to deliver the one thing you bought the company for, and day 100 to measure it. Write the plan before closing, because the deal is signed in one day and won or lost in the three months after.

Before closing: the plan you need on day one

Most of what goes wrong after closing was knowable before it. Have these ready before the wire goes out:

• The announcement. Who tells the employees, when, and what they say. The seller should stand next to you when it happens.
• Key-person conversations. The service manager, the lead techs, and the office manager hear it from you directly, with their retention terms in hand.
• The license. Who holds it after closing. Contractor licenses usually do not transfer with the company; they sit with a qualifying individual, and boards set short windows to replace one who leaves. Rules vary by state and trade. See licensing in the home services trades.
• Payroll, insurance, and bonding. The first payroll runs on time and on the same day. Insurance, workers' compensation, and any surety bonds are in place in the right entity, which in an asset purchase usually means new policies and new bonding, not the seller's.
• The phones. Phone numbers, the Google Business Profile, the website, and the review accounts move to you and keep working. In a service business the phone number is the customer list.
• Trucks and accounts. Vehicle titles, fuel cards, supplier accounts, and software logins, listed and transferred.

Days 1 to 30: stabilize

Change nothing a technician or a customer can feel. Same pay, same pay plan, same pay day, same schedule, same phone number, same name on the trucks. Your job this month is to listen.

• Meet every employee, not just the managers.
• Call the top 20 customers yourself, with the seller if possible. Tell them who you are and that nothing about their service is changing.
• Honor every maintenance agreement and warranty exactly as written. Prepaid agreements are money the seller already collected for work you now owe, so know the count and the dollars on day one.
• Watch cash weekly: collections under the new name, retainage and progress billing on project work, and any deposits the seller took for jobs you now have to finish.
• Leave the software alone. Moving dispatch or accounting systems in month one is the fastest way to lose calls, lose invoices, and lose technicians.

Days 31 to 90: deliver the thesis

Now act on the reason you bought the company, and only that. If you bought density, start combining routes. If you bought technicians, get them trained on your systems and into your pay plan with nobody losing money. If you bought maintenance agreements, get the renewal and pricing program running. If you bought a customer relationship, put your people in front of that customer alongside the seller.

Everything else waits. The integration list will be long, and most of it does not matter yet. The asset you paid for is the one that has to show up. See the eight inorganic moves for what each kind of deal is really buying.

Day 100: measure it

Go back to the one number in your acquisition thesis, the measure that proves the deal worked, and check it. Check retention of technicians and top customers, and cash against plan. Then decide what changes next: systems, branding, pay plans, and the second wave of integration.

The risk map

Score your deal on each of these before closing. Any one can sink it.

• Technicians. What breaks: the best techs leave for a competitor who calls the day the news gets out. Early warning: quiet, or a sudden spike in sick days. Fix: tell them early and in person, protect their pay, and put retention bonuses on the people the deal depends on.
• Customers. What breaks: the customers were loyal to the seller, not the company. Early warning: renewals slip and the big accounts stop calling. Fix: joint calls with the seller and a transition period built into the deal.
• The license. What breaks: the qualifier leaves and the company cannot legally bid new work. Early warning: no plan for who holds it after closing. Fix: a qualified holder in place on day one.
• The founder handoff. What breaks: the seller is still the person everyone calls, or disappears on day one. Early warning: the phone still rings to the seller's cell in week six. Fix: a written transition plan with a defined end.
• Cash. What breaks: prepaid agreements, deposits, and slow collections squeeze working capital in month two. Early warning: a widening gap between billings and collections. Fix: a working-capital target in the purchase agreement and a weekly cash review.
• Systems. What breaks: a rushed software change drops calls and invoices. Early warning: complaints about scheduling. Fix: no system changes in the first 30 days.

Most of these risks show up first in diligence, where they can still change the price or the structure. See what lowers the value of a business and what kills acquisitions.

Related questions

• What changes when you go from one acquisition to one a year?
• What could go wrong buying a business, and what to do about each risk
• Why would an owner sell to you instead of private equity?
• Quality of earnings: which add-backs are real?
• What kills small-business acquisitions, in order