Factors for Distributors to Consider When Selling Their Business

While distributors like Tahoe Supply Co. are steadfast in their decision to remain independent, others are on the fence about selling their business. Offers from large-scale companies can be attractive financially, but many times there is more at stake than the minutiae of a business transaction — and reasons for selling are varied and often personal. 

Ken Sweder, CEO of BradyPLUS, Las Vegas, is no stranger to mergers and acquisitions. The national distributor rebranded in 2023 following the merger of BradyIFS and Envoy Solutions. Prior to taking the helm at BradyPLUS, Sweder was CEO of BradyIFS, which itself was the product of a merger.  

Sweder shares that M&As are the result of a natural progression across all industries as people look to expand product bundles, shed some of their day-to-day responsibilities and become part of a larger team.  

“With any sale, there’s a change. But it can be as positive a change as any,” he says. “Operators may want to continue their legacy and remain relevant, even after they sell their business. If you look at our senior team, for instance, many of them have joined us through acquisitions. So as people look for new partners, they should spend time talking to them about the longevity of their legacy and the impact of the merger on their team.”  

According to Sweder, these conversations are just as important as the terms of the financial agreement. To facilitate the decision, BradyPLUS aligns with the seller early in the process by getting to know their business and management team as well as their goals moving forward.  

“We have discussions and ask questions: Are we a good fit together? How are we going to take care of your team? What role do you want post-sale so that you can continue to grow in a larger organization? When done right, these types of businesses are built on relationships, not transactions, because everyone wins that way,” he says. 

When prepping for or considering a sale, Griffin offers the following tips: 

Adapting to the Sale 

Following an acquisition, sellers may have a difficult time transitioning to the new company depending on factors such as their role in the organization, the terms of the transaction and the corporate culture. Sweder recommends that both parties reach an agreement early in the process to align their values and aspirations. 

“Yes, things will change, but those changes are born from opportunity and potential, as well as an aligned vision — and that alignment up front pays incredible dividends,” he says. 

Sweder shares that when BradyPLUS acquires a new company, changes are introduced gradually to ease the transition for employees. 

“On day one, there are no changes to the name of the business that was acquired. We want customers to see exactly what they’ve been seeing, which is important in terms of customer continuity and relationships,” he says. “Once people are comfortable working with both brands, we transition to one brand over time.” 

Sweder explains that this “passing of the baton” simplifies transactions for the customer and makes the transition seamless for the acquired company, too. Additionally, BradyPLUS ensures that the new distributor feels welcome. The company hosts events that facilitate onboarding and help employees assimilate the company’s vision and culture.  

Indeed, by fostering a culture of collaboration, distributors might find that mergers and acquisitions open doors, leading to new career opportunities. That said, acquisitions aren’t for everyone and those who choose to remain independent can differentiate themselves from the pack. Ultimately, embracing the evolving distribution landscape and remaining agile allows distributors to not only survive, but thrive in a dynamic marketplace.  

Kassandra Kania is a freelance writer based in Charlotte, North Carolina, and is a frequent contributor to Sanitary Maintenance.