Today the U.S. Government will announce their estimate for fourth quarter 2008 GDP growth. Expectations are that the economy retracted at least 5% in the final quarter of last year, perhaps the worst quarter we have had in almost 60 years, certainly the worst in the last 25. So now that the sky has fallen, the world has stopped, and cats and dogs are living together let’s all take a deep breath, and remember exactly what we have.

A couple of months ago I stopped paying attention to the economic news. It got to the point that everywhere I turned all I read about and heard about was so powerfully negative in regards to the economy that I could no longer think clearly about my business. I believe we have now become so focused on how bad things are, that we are likely making them much worse than they need to be. The reality is that the economy goes up, and it goes down, right now it is down, someday soon it will probably be up. There are lot of people who make a lot of money on major fluctuations in our economy, and there are people who will suffer tremendously, but at the end of the day, business is still moving forward, commerce is still happening, and economic activity is still going on. The United States is the world’s largest economy this morning, and it will still be the world’s largest economy at the end of day, we have more than just a fighting chance at success.

The rumors have gotten silly. I stood in a line the other night, and the gentlemen behind me was telling his entourage that Starbucks and bottled water were both going away. Yes, Starbucks closed 300 stores this week, out of the 16,000 they have worldwide. The media plays it like it is the end of the world, but for those of you who are Starbucks addicts I imagine you will still be able to fill up in the morning. For the guy in line behind me who believe folks are not going to pay $4 for a latter, or $1 for a bottle of water, I’d like to point out to him that he just spent $5 on a beer. Starbucks and bottled water are not going away, it is an economic downturn, not an economic meltdown!

For business owners who are trying to manage through this chaos, which has reached a crescendo of ridiculous naivete, I would make three suggestions. The first is simply to pay attention to cash flow, if you keep those cash numbers in the black you will have little to worry about. The second is to keep selling, some people are still buying despite economic conditions, you need to get out and find them. The third is simply to be smart about your spending.

I feel confident saying a year from now our discussion will focus on economic recovery rather than disaster. The media pundits seemed to be the last to admit that the economy was headed down, and they will certainly be the last to admit when things turn. Their goal is to ride this news horse as long as possible, until the next big story comes along. When they begin to turn their attention you’ll know things are on the right track!

We are almost one month into our newest acquisition, and so far things are moving along quite well.  There have been no major surprises, although we did not get a honeymoon from the business of business.  We have already found ourselves battling the trap of working in the business rather than working on the business.

Fortunately for us there have been no major surprises, and we inherited a great group of employees. Revenue this month is a bit light, but has picked up the last couple of weeks, and cash flow looks pretty good. We already hired our first new employee, ironically she use to own another company we acquired last year. Despite all of our stress and worries about what would go on the first month, it has been somewhat uneventful. Today we are battling the weather as a major snow and ice storm makes its way across Dayton.

So far, the hardest part of this process was the decision to do the acquisition. I spent many sleepless nights prior to the end of December worrying about whether this was the right company at the right time. Once that step was taken, we have pretty much just hit the ground running, and not really looking back. There is no telling what the future holds, but there is little doubt we are back where we belong doing what we were trained to do! 

Our new venture has had me pretty tied up over the last week, so I have not blogged at all about how the first week went.  At this point my partner and I are just getting our hands around the business, and digging into what has happened in the past, and what short-term improvements we can make.  Our most important first week lesson is that there is just never going to be enough time in any given day.

I have done my best to plan out what I will try to accomplish each day; however, it seem each day brings a new challenge. The first day, before we even opened our doors, we had our first resignation. A Customer Service/Sales Rep. decided the change in ownership made for a good time to shift her personal career direction. Fortunately, that resignation has not had a tremendous amount of negative consequences, and it opened up another potential opportunity for us. One that could pay nice dividends.

We have not had any big surprises, what we thought we knew about the business has been for the most part true. The only surprise may be, after six months of due-diligence, what we didn’t know. So far none of what we didn’t know has been negative, it is all things that seem to open up new opportunities. The challenge is deciding what opportunities we should take advantage of now, and which we need to save for a rainy day.

Over the years I have been involved in selling businesses and acquiring businesses. The process of doing a deal seems to be pretty standard across, what I have learned this past week, is that the dynamics of each transaction can be wildly different. If you are buying a business you need to mentally prepare yourself for that wild swing in dynamics that will occur the first day you open the doors!

By the way, we met our first payroll last week. One down, many, many, many more to go!  

Last week Rough Air Associates took another major step forward.  Through a holding company owned by Rough Air, my partners and I acquired another small business in Dayton.  Two years ago when we started Rough Air, it was just my wife and I with an idea.  Today we have 25 people operating out of three locations. 

The acquisition process was relatively intense, and sucked up the majority of my time over the last six months. Today the real work starts, by 8:00 a.m. we already had our first resignation. An employee decided she was better off taking another path rather than sticking with the company through the ownership transition.

Throughout the next year I will attempt to blog frequently about our new business, the process of buying the business, and the challenges we are facing. Hopefully, our experience will help you move your business forward!