Dear Stephen,
Reading about Visual Comfort acquiring Pooky and Forbes & Lomax reminded me of OFS buying ROOM, which joined a family of brands that includes Carolina, Bryan Ashley, and Styline Logistics. Clearly, the companies we traditionally call “the majors” aren’t the only ones shopping. I’m a salesperson at an independent furnishings company. If an established manufacturer like OFS buys you instead of one of the majors, such as HNI, does that say anything about your company’s standing—or am I being a snob? Does being sold suggest the business needed rescuing or simply needed more resources to grow?
Should I feel differently depending on whether the buyer is a smaller family-owned manufacturer, a private-equity firm, or one of the industry’s majors, such as Haworth, MillerKnoll, or HNI? Does who owns the buyer—and how big it is—tell me anything about what comes next for employees? Everyone congratulates the owner. I want to know if the employees have something to celebrate.
Signed,
Who’s Buying—and Where Do I Fit?
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Dear Who’s Buying,
HNI has three initials. OFS has three initials. Neither guarantees your job. And since you asked: yes, there is a little industry snobbery in assuming an acquisition carries more prestige because the buyer is one of the majors. Fortunately, this condition is treatable. OFS is a substantial manufacturer with an established family of brands. Being acquired by OFS does not make your business second-class. Unless you were involved in the sale, you don’t know who was approached, who expressed interest, or what mattered to the seller. You’re looking at the wedding announcement and inventing a list of people who declined to propose.
I would be more interested in why the buyer wants your company. A product could fill an important gap at one business and receive very little attention inside another. Being important to the right buyer could mean more for your career than the industry status attached to its name. Let’s also retire the idea that selling automatically means someone needed rescuing. Sometimes an owner has built something valuable and wants to get paid for it. Imagine that. Other times, the business needs distribution, infrastructure, or investment the owner cannot—or simply does not want to—provide. Retirement is also allowed. Founders are not required to remain at their desks until someone names the conference room after them.
That said, a CEO from one of the major manufacturers recently told me, “Viscusi, these companies are calling us right and left to be bought.” My first thought? Of course they are. Some may see you as a bank—a way to cash out—rather than a partner to help grow the business. I told him I would be more interested in the companies that weren’t calling. Go knock on the door of a business you already want to own. Don’t let everyone else’s desire to sell become your acquisition strategy. There are good businesses actively seeking buyers, but the fact that someone wants out doesn’t explain why you should want in.
Look at what Knoll saw in HOLLY HUNT when it bought the company. Andrew Cogan spoke about his longstanding admiration for Holly’s work and how the brand would advance Knoll’s residential business. There was a clear reason that brand belonged in the portfolio. As an employee, listen for that same clarity. What does the buyer value about your business, and are you part of what makes it valuable?
You should also understand where the money is going. The check written to your owner is not your new sales budget. ROOM added modular workplace products to OFS’s offering, and Visual Comfort’s showroom network gives acquired brands access to more customers. Those combinations can create opportunities, but somebody still has to turn them into orders. Will you have more products to sell, better access to customers, or the support to pursue business you previously couldn’t handle? That would give you something to celebrate. Another logo at the bottom of your email does very little for your commission statement.
As for your three types of buyers, let’s separate size from ownership. Haworth is one of the majors, and it is also family-owned. MillerKnoll and HNI are publicly traded. OFS is family-owned, but don’t confuse that with small. And a manufacturer backed by private equity, such as Visual Comfort, can be an industry force in its own right. These descriptions tell you something about who owns the business. They do not tell you how you will be treated on Monday morning.
A smaller family-owned buyer might put you closer to the person making decisions, but how much can it invest? A private-equity buyer might bring capital and a serious growth plan, but what results does it expect, and on what timetable? One of the majors might give you broader distribution and more products to sell, but where will your company—and your job—fit within the larger organization? Family ownership is not a promise of lifetime employment, and a public listing is not a guarantee of opportunity. Ask who will run the business, what the buyer plans to invest in, and whether your accounts, territory, or commission plan will change. If management cannot answer everything immediately, ask when it can. “Business as usual” is an announcement, not a career plan.
As a recruiter, I also want to see whether the buyer invests in the people expected to deliver all this growth. Promoting experienced employees, bringing in good sales leadership, and providing useful training matter. Ask how those investments will reach your team. And if you bring experience from one of the majors, put it to work. A company can eliminate your position without eliminating your talent. Just don’t spend the next five years explaining how everything was done at your previous employer. Nobody hired you to curate a museum.
Be prepared to explain your contribution, too. What business do you bring in? Which customer relationships depend on your involvement? How could you sell the expanded offering? You should know your value before asking a new management team to recognize it. I would rather see you with a strong territory, a boss who answers the phone, and a commission plan worth getting out of bed for than a famous logo and three layers of management explaining why you earned less. Prestige is a lovely thing until you try to deposit it.
Give the new owner a fair chance, but judge the deal by what happens to your ability to succeed. Better products, better support, and more opportunity to earn? Stay and sell. Fewer accounts, less support, and vague promises about how everyone will benefit eventually? Start taking calls from headhunters. Your owner just made a business decision about their future. You are allowed to make one about yours.
Stephen Viscusi