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Haven’t You Dreamed of Getting a Leg Up on Your Competition? Why Not Now?

We have written repeatedly about the need to plan for what you want your business to look like when the economy turns around. It is also important to consider what opportunities might be available to you right now. This includes not only getting your operations in order, but also making sure you understand the current state of affairs in your marketplace and the position of your competitors. Once your house is in order, there might not be a better opportunity than right now to increase your market share, either by attracting talent or even buying competitors.

In their October 2, 2008, BusinessWeek article, “How to Seize the Storm,” Jack and Suzy Welch write, “Do everything you can to buy or bury your competition,” and “ … your balance sheet will likely allow you to take advantage of a downturn’s one benefit: the opportunity to make bold moves. As JPMorgan Chase has done all year, you can look for fire-sale acquisitions.”

While it’s important to be aggressive, you also need to be cautious. Buying a company comes with risk, but buying what might be a distressed company or its assets intensely magnifies that risk. Mark Robertson, Practice Leader for Blackman Kallick’s Transaction Services Practice, offers some insight on buying a distressed business.

As Jack and Suzy Welch point out, “In a crisis, managers must go on the defense. But you need to unleash your offense, too. This downturn may have just begun, but it will end. Don’t just think survive; think seize the day.”

This publication is part of Blackman Kallick’s marketing of professional services, and is not written tax advice directed at the specific facts and circumstances of any person and/or entity. Contents of this publication are of a general nature, and you should not act on this information without obtaining professional advice from your business advisor that is appropriately tailored to your individual needs and circumstances. This written advice is not intended or written to be used, and cannot be used by any taxpayer, for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code.