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May 3, 2021

How2Exit Episode 5: Josh Ploch - Serial Entrepreneur, HR Expert, and Business Broker

How2Exit Episode 5: Josh Ploch - Serial Entrepreneur, HR Expert, and Business Broker

Josh is an experienced HR and Strategic Planning practitioner. Over 20 years experience in HR, Leadership, Strategic Planning and Entrepreneurship.
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Contact Josh on
Linkedin:...


Josh is an experienced HR and Strategic Planning practitioner. Over 20 years experience in HR, Leadership, Strategic Planning and Entrepreneurship.
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Contact Josh on
Linkedin: https://www.linkedin.com/in/joshploch/
Website: http://www.joshploch.com/

If you’d like additional ways to support this podcast, you can become a patron here: https://www.patreon.com/bePatron?u=66340956
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Reach me to sell me your business, be on my podcast or just share some love:
Linkedin: https://www.linkedin.com/in/ronskelton/
Twitter: https://twitter.com/ronaldskelton
Facebook: https://www.facebook.com/How2Exit

Have suggestions, comments, or want to tell us about a business for sale call our hotline and leave a message: 918-641-4150
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Watch it on Youtube: https://youtu.be/a0kYduCvP_Y
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Other interviews:
Zoran Sarabaca: https://youtu.be/OLqszNP7yHY
John Andrews: https://youtu.be/vmGWbd2y5x0
Chris Daigle: https://youtu.be/jHWzFGRbpD4
Arturo Henriquez: https://youtu.be/uwN7y8AE4EQ
Joe Valley: https://youtu.be/ZQLdybxcZKs
Christopher Wick: https://youtu.be/xhIf9ltgedA
Jonathan Brabrand: https://youtu.be/oC82Ls54CXo
Carl Allen: https://youtu.be/VIU2Lqj_FY4
Klint Kendrick: https://youtu.be/eJ2GICCj2TA
Walker Deibel: https://youtu.be/xoUH_Ixeook
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Ronald P. Skelton - Host -

Reach me to sell me your business, connect for a JV or other business use LinkedIn:
Ronald Skelton: https://www.linkedin.com/in/ronskelton

Have suggestions, comments, or want to tell us about a business for sale
call our hotline and leave a message:  918-641-4150

 

Transcript

Ronald Skelton  0:06  
Hello, and welcome to the how to exit podcast where we introduce you to a world of small to medium business acquisitions and mergers. We interview business owners, industry leaders, authors, mentors, and other influencers with the sole intent to share with you what it looks like to buy or sell a business. Let's get rolling. Hello, today I'm here with Josh plush Josh is a serial entrepreneur with both corporate background where he was manager of some pretty good-sized companies and their HR and understands the HR and actually speaks at HR events, all the way to be in a serial entrepreneur where he owns multiple franchises, and he's also a business broker. So we're gonna interview him today and find out everything we can about what a business broker looks for, and what information we can get from him when we're looking to either buy or sell a business. Thanks for being on the show, Josh.

Josh Ploch  1:02  
Yeah, thanks for having me around.

Ronald Skelton  1:04  
Cool. So the first question is always get to know you type of questions. So start anywhere you want to start and I know some people have painful trials that or something so I'm not telling you to start, don't go through anything that's in it, make this an emotional event or whatever. But just tell us your story. Through my CIA

Josh Ploch 1:19  
career.

Ronald Skelton  1:23  
You know, I always joke around I usually say, I didn't warn you ahead of time. I don't talk about it. In the military, I was military intelligence, and I just can't. So you can ask me questions. We go back and forth on this. There's just certain things I won't talk about. And so there's certain things I won't ask you about personally. But, uh, anyway. So tell us about like, kind of who you are, what you stand for. And, you know, something cool to know about you?

Josh Ploch 1:47  
Yeah. So yeah, as you said, I actually started my career originally, not in HR as a women's basketball coach in Division One, and pivoted out of that pretty early. That's what my undergrad was in. And that was what I thought I was going to do for a really long time. pivoted out of that early, just listening to a mentor, that just said, this is not the life for a family, I was newly married. And, you know, we traveled for games, half the year, we traveled recruiting half the year, and he said, You know what, like, this is not, this is not a family person's career. You know, there's just so much turnover and coaching and all that other stuff. So I've pivoted really early on and got into operations, and HR, and staffing. And I've done a number of things in that space over the years for, you know, from international recruiting to recreation space, tribal space, all kinds of stuff worked for multinationals, that whole bunch of, you know, just a bucket of things. And through that time, like you mentioned, you know, we had a number of different businesses, a number of different franchises. And I really just started to see the, you know, the connection between those and what I was doing, and with a lot of the things that people were using in corporate America on a little bit larger scale, where that could really add value in smaller mom and pop operations, you know, both the ones I was doing the ones that my friends were doing. So we transitioned a couple years ago, just starting to be able to put some of that knowledge and experience to work and adding some of those things, you know, and you get into value stream mapping, and Six Sigma, things like that, applying some of those tools that do used over the years into smaller operations to really help them grow.

Ronald Skelton  3:38  
sounds really interesting. So you and I have known each other for a couple of years now we both have backgrounds in real estate and entrepreneurial ventures, I tagged you on one of the big acquisitions I was working on, unfortunately, to be on the team and be part of that acquisition, because it had 55 employees and I know enough about HR to get myself in trouble. I could probably fill up a post a note. And so you don't do that. When you have 85 employees, there are rules and stuff we've got to follow. So. Yep, yeah. So I think this is gonna be really fun. Because not only your business broker, you're super entrepreneurial. And we can actually ask some questions about I'm acquiring a company that's got 55 plus employees, what is there anything else I need to do inside of the due diligence type of questions? Right? Yeah. Sorry. So let's just, let's just kind of get started here. What interested you in the like becoming a business broker? You know, what's the what opened your eyes to that and move before there?

Josh Ploch 4:40  
Yeah, and I think you mentioned that you know, we both are active also in the real estate space. So we were meeting a lot of property owners that were also business owners that were looking to transition. And again, it was really just a, you know, sell to the people that are there. Okay, ready to buy right? You know, it was just filling You need, you know, that really match between what we were doing anyway, you know, what I was doing on the side helping business owners, you know, really just helping provide solutions. Because, you know, it's somewhat common to see, you know, a property owner, if they have a commercial property or, you know, a bunch of apartment buildings, bunch of multi-families, you know, a lot of them are also serial entrepreneurs, they may have a business, that they're also looking to exit, you know, they may have a couple of different things. So there was really just a synergy there that, you know, we wanted to help just in any way we can, right, you know, if we can help them take care of their property, and move on to the next step, if we can help them take care of their business and move on to the next step, then we really found that it's a win-win for everybody.

Ronald Skelton  5:45  
Awesome, so let's kind of walk through the process of a business owner, they've been running their business for a while, for one reason or the other, there's a, there's just, you know, there's many, many reasons why somebody wanted to consider a liquidity event, you know, to sell their business and stuff. And, you know, they either get a letter from you, or they hear about you in some shape or fashion, they Google you find you online, and or they show up at your office, kind of go through the process of what a business broker looks at, when looking at businesses that are thinking about selling, because I think it's probably a little different than what I would look at, you know, as an acquisitions guy.

Josh Ploch 6:26  
Yep, I'll give you kind of the official answer, but then also give you the side answer, you know, and the official answer is the traditional valuation just looks at your tax returns over the last couple of years, you know, we go through a process that we call add-backs, which are, you know, things that the new owner can expect to have, you know, if you pay your phone bill, or if you pay a car payment, or if you, you know, some of those things that are uniquely yours, we can add those back, because the new owner would also expect to, you know, receive that benefit, either through that process or through, you know, just getting the money. And then we just Mark Yeah, we do a market comparison and market analysis, determine the valuation. And we can see, based on those numbers based on what the market holds, as far as what other properties, what other businesses are selling for, in that same space, and then determine the valuation and there, I'm oversimplifying it, you know, our evaluation documents are, I think, 37 pages long, so I'm giving you their high-level overview. But that's, that's really the core, you know, we look at the tax returns, we determine the revenue, we maximize the revenue for the business owner where we can, and then that's really where, let's say, the hard work begins. And this is my second answer to you, you know, the hard work begins on the selling side, it's, you know, similar to real estate, right, everybody can lock up a house and sell it at the right price. That's the challenge, you know, and getting that that person in place. So, the fun thing about business broker, you know, is that there are as many solutions as there are companies, you know, and there may be a business that, you know, is a great opportunity for a roll-up, which has a space that you're active in, there could be a business, that's a great opportunity for, you know, in acquisition for another similar company, like you have a heating and air company, there may be a bigger Heating and Air company that you know, wants to absorb that, you know, those clients, there's just every opportunity, you know, there's all types of options, all types of opportunities, you know, once a business owner decides they want to take that next step. And that's really where the creativity comes in. You know, the work comes in being proactive, you know, and that's really where our work comes in, you know, on these transit on these transactions.

Ronald Skelton  8:52  
Yeah, so in the so in our world acquisitions or mergers world, you know, what we're actually acquiring the acquiring side. You know, one of our frustrations is across the board I'm not saying that your brokerage does this or any particular brokerage does this but we find that the brokerages prices or the evaluations tend to be a little higher and here's what I attributed that to the seller you know, here's a scenario and as we'll walk through this and I want your feedback on kind of what you think's going on or how frustrating this is to you also cuz I'm sure this will happen to you if it hasn't happened already. The seller comes to business broker one does their evaluation and says businesses worth you know a million know where you're going with it yeah. And so I have an appointment with you know, business broker to I'm going to go see business broker to and he goes oh, yeah, million I can get you 1,000,002 Right. And the next thing you know, this thing's this guy's gone to his third business broker. It's out there listed at 1.4 when honestly is probably worth 950k Right it even the first brokers tried to try to get the most he can. And, you know, now we've got a seller who has unreasonable expectations at 1.4? It doesn't understand why, you know, you know, a mergers and acquisitions. Acquisitions guy like myself comes in and goes, You know what? I couldn't give you a dime over 950? Right, right. You know, or we have to get really creative if I do. So, I mean, how does? Have you seen any of that going on yet? Or? Truck?

Josh Ploch 10:23  
Yeah, that's, I mean, that's one of the biggest challenges with the industry. Right. And it's, it's for that exact reason, you know, it, it is on the broker generally, to be able to educate the business owner on what the proper price is, and, you know, the proper price is what's going to move the business if they're ready to exit. But like you said, there are certainly brokers out there that will, that will promise things that maybe they shouldn't be or, you know, not, and I won't even go negative, right, they can be overly optimistic, right? Oh, they're listing price and say, Yeah, I can probably get this or I'll, I've seen this, and, you know, I think I can make that happen. But it does create a challenge for the business owner, it creates a challenge for the buyer, you know, it creates, you know, sometimes can create a bad taste in the mouth of that business owner, you know, so really, it's up to us as an industry just to, to really make sure we are doing our due diligence, and, you know, all the things that many of the other industries go through, right, there are training, you know, our network, making sure that we're connecting with, you know, other people in the market, our corporate partners, to say, Hey, what is the, you know, what is the best and most reasonable price, that's going to get the outcome that we want from this right and, and, you know, listing it for 300,000 more, if that means it's going to either never sell, you know, or sit on the market for months and months and months, isn't a great option for anybody, you know, so there are people out there that would do that, like I said, But, you know, it is a challenge that the industry has to just stay on top of and have smart conversations. And I would say that's probably what it comes down to. Right. It's a, it's a hard conversation challenge, and some people are more comfortable, with having those conversations than others.

Ronald Skelton  12:21  
You know, it's interesting, what it leads to is, you know, in the acquisitions and mergers space, I've actually taken on a few different mentors, taking courses just because I'd rather learn from somebody else's mistake and pay, you know, pay to learn that way than I would ever pay to learn from my own mistakes. So, and two out of the three mentors I've been through, really discouraged us to go into anything that's currently listed, or anything that's currently listed by our broker, just for that reason, right there. There's the well, that reason, and the brokers, in my experience, and what these guys experienced, they'll kill a deal if there's creative financing on the end because of the risk to the seller. So you know, what's your thought process on, you know, doing something other than an LBO leveraged buyout, where the seller gets the full check at closing?

Josh Ploch 13:15  
I look for situations where the best of your ability you can have honest people sitting down at the table with the best interests in mind. Right. So, you know, I think it's good for the sellers or buyers, whatever side you're on to have someone, you know, that's looking at these things, and has some experience in them. You know, I, I would be hesitant to do deals in a vacuum. Just because, again, there's things out there, maybe you haven't seen things out there that you haven't experienced, you know, and I think a broker does provide that for you. You know, I certainly see from the cost perspective that, you know, there, they may not see as good a value, you know, if they have brokers that are trying to get the most money to the seller. You know, I think you can have both and still, you know, still win, certainly brokers bring you, you know, on top of a well-prepared seller and a well prepared financial statement, and a well-prepared company, you know, they also bring you experience and they're going to bring you, you know, additional deals if they go well, you know, because we see a lot of them come through, you know, I've seen on the flip side to where, you know, I work with people that will buy things that maybe would not be sold traditionally, right? So, you know, I may see a deal and bring it to a partner, and I may look at the steel and say, You know what, this is probably wouldn't be a great deal for you, if we list it traditionally and put it on this buy sell or whatever that is, but, you know, I have a partner who this would be right up their alley, you know, and you can win, they can win, you know, and we can all you know, discuss We can stack wins for everybody on this. So you know that that feeling doesn't surprise me. But obviously, I'm going to come down probably on the other side of the fence. And I think there is a lot of value that we can add just by working together.

Ronald Skelton  15:14  
Yeah. So one of the things that I've noticed I've interviewed, not on the podcast, but just like talking to business brokers and trying to get some of the bigger business brokerages out there, like the head, guys, you know, to come on on the podcast, I talked to one, I won't say their name, just because I want to say something about them. And I don't want to discourage anybody. They have over 200 250, what they refer to as deal originators, and I was talking to one of them, he's a director of inbound deals, or whatever his title is. And so his job is everything, all the leaves, all the stuff comes through him. And then he farms that out too, you know, various people. And, you know, he was telling me that they get between 30 and 50, what he calls do not qualify as DNS D and Q's a day. And so, you know, we got into a deep conversation, I wished him to let me record it, he has to get corporate compliance allowed me to do that. But as to what to do not qualify is so you know, the question I have for you is in your world, are there businesses that are going to come through that just, they don't qualify to be listed by a real buyer broker? What would that criteria look like?

Josh Ploch 16:27  
Yeah, and, again, I'm talking about kind of the challenge and then more specifics, but you know, the challenge that all business owners have is through the life of your business, you are trying to minimize your tax burden. Right. So what that looks like, you know, when you go to exit, you know, is that you have tax returns that show very little revenue. And so both of those, those steps are very valid, you know, but our job or the job of some of them, in this process, if you're going to exit your business is to dig into this and figure out, you know, what, what stays what goes, right, what does this look like, when you peel some of those layers away? So, to answer your question, specifically, you know, what to do not qualify is either going to be someone that shows a very low revenue, you know, then maybe one and make a great deal for a buyer, you know, there wouldn't be any kind of return on their investment, you know, or a business that's just very owner focus, that can be really challenging, right, if we, if that owner exits that seat, if it's hard to see a straight line for that business to continue, then that's going to be a really hard sell. So those are, those are some of the other ones. I mean, there's other things in there, like, you know, if you see some certain things in their financials, or, you know, obviously, if they're running a loss, things like that can make it really challenging to sell, you know, unless, again, you're able to add back some of those things. And they're verifiable, right, that's the third thing, you know, if we have a business owner that says, you know, I'm showing a loss every year, but I have a cash business, and I take out 100,000 A week in a paper bag, just trust me, you know, that's gonna be Yeah, that's an extreme example. Right. But that's, that's gonna be a do not qualify, because you can't verify that there. We, we, as brokers want to ask anybody, I would not want to represent that. You know, so those things like that are that are unverifiable, you know, would fall in that category?

Ronald Skelton  18:38  
What about high debt structures? Or when your evaluation model does somebody, say several of these kinds of overburdened with debt, and they're barely maintaining the service end of their debt? With that, push them out for you?

Josh Ploch  18:52  
It's gonna be a lot tougher, obviously, you know, there are some people that specialize in that space where they can restructure some of that. But it would certainly cut down your pool of buyers, you know, I would say with more fall into those buyers and specialize in that type of deal. You know, versus somebody more traditional that may be coming in as an owner-operator, you know, are looking for an investment.

Ronald Skelton  19:16  
Yeah, I actually had I reached out and started talking to some people and I have a group of people that can do that restructure in this, there's not very many out there. I've only found down so far, but it is possible. Now they need a much bigger company than when I was initially targeting. But uh, you know, they can do it. So that is possible. So, one of the other questions I like to ask is, what do you believe is a common myth about the business brokerage profession that you just like to debunk? You know, it's like, it's, you know, it's out there. People think it, it's not true. And you'd like to nip it?

Josh Ploch 19:55  
Yeah, I would say probably the one that you mentioned, you know, that that just when you're working with a broker that it's no longer good value, you know, the opposite of that is true where we have the experience that we can bring add-backs and show value and structure those things so that, you know, some of the things that you may not have already looked at, you know, we can highlight some of those areas, both on again on the seller and the buyer side, right. So the buyer side, make sure that they're getting as much value as they can, and the buyer side, make sure that we're looking at everything, you know, that we need to be. So it's, you know, our role on the broker side is just to be the partner, you know, and make sure that, that everything is getting counted, you know, that should be, and that we make the deal as good as possible for everyone involved. You know, we want to if I'm representing a seller, you know, I want you or a buyer to be successful as well, you know, it's not, it's not zero-sum.

Ronald Skelton  20:56  
It's interesting as I find myself looking at things that I know where else I know what I'm looking for. But I also know people that it might work for I had one this morning, I was talking to a guy who has a mobile tire repair shop. Turns out, he came out and replaced some of mine. And I told his employee that, uh, you know, started asking questions about his business and said, You know, I might want to talk to the owner someday, well, I got contacted by the owner, he's thinking about retiring and selling the trucks and stuff, they actually go to your, you know, your place, and you can swap your tires right there. Like they did it out in my field at my farm, you know, like, literally brought two tires, I had the double blowout, and they just brought two new tires out there and, you know, pulled mine off, balance them right there in his truck and had hydraulic, you know, equipment in the van and just did it right then and there. But I'm not interested in that. But I know a couple of mobile mechanic shops and stuff, you know, I might be able to put something together for those guys that have an add-on to their business. And, you know, what we call take a stake, I might, you know, work out something where I end up with 10 or 20 or 25% of something? Because I pulled it together? How creative do you, you know, work? Like? Where's the boundaries only to creativity that we can do deals with a broker like yourself? And Oh, could you know, do an add ons and there's, you know, people get pieces of the deal and stuff is, you know, is everything on the table? So long as it's all fair to both parties? Or is there just a structure that you want to, like, you know, the owners of stick to?

Josh Ploch 22:21  
It varies from state to state. And, you know, just before I get into that, I mean, I'll say just personally, right? I like the game, I love entrepreneurship, you know, some of those stories are, you know, why I enjoy this, right, you know, I'll sit across from an owner, that starts describing their business and describing the revenue, and, you know, just like, wow, that's, that's cool. You're making a great living doing that, I just never would have thought it. And I just, I love hearing their stories, just because I'm an entrepreneur at heart. And, you know, I geek out over those things. And, you know, those are the stories that I just love to dig into, you know, like, how did you build that? How did you, you know, think of that, how did you get your customers for, you know, as a mobile mechanic, get their customers instead of going to Robert Sims or something like that. But yeah, I mean, that's, again, why I'm in it, because I love that stuff. I love the stories. And then to answer your other question, it really varies from state to state to some of the states are really regulated, you know, similar to real estate agents, some of them even require the same licensing as agents. So those are going to be, you know, a lot more structured those states, you know, some of the other ones, it's a lot more flexible, you know, to end on that. I would say it also just barriers on the broker, you know, some brokers may be more interested in, you know, being more creative others in a really like the lane and stay in there as well.

Ronald Skelton  23:46  
You know, it's interesting, as I'm fascinated too, I mean, I have, we go out there, and usually somebody's doing a business and you think I can't be doing much, you start looking at their books, like, you know, holy cow, right? I have a cousin, if you ever Googled him or whatever, he kind of we look a lot of like, we have the beard book, big guys. And he owns a business that sells basically giant ball bearings. You know, he actually, you know, he had he actually has two brass, or chrome balls tattooed on his leg, you know, in his leg, and he likes to do the job for you, though, like Steel's to show people his cat. Right. And but it's they're ionized. Do I know whether you use I guess they use it in like tumblers have the stuff to clean other materials? So he sells these things, and it's an industrial product. But you know, I'm thinking you sell still marble marbles basically, are your ball bearings. And how much money could you make doing that? And we were talking and he does pretty good business. It's just him. It is like, you know, it's, I won't say the numbers because, you know, we're relatives and stuff, but it was impressive, right. You know, you're thinking, you know, how can you make a living selling, you know, pretty much a one product Like to it's just you know, they're Harden, ionized or anodized, or stuff like that ball bearings is all they really are. But yeah, I'm always

Josh Ploch 25:08  
doing really well, selling spindles like on your stair railings have a whole business selling spindles that you can't find the lows and they're doing great.

Ronald Skelton  25:21  
All right. So, yeah, so I'm fascinated by it too. So there are times where I catch myself, like, I know, I'm not gonna apply it, but I just like a deer in the headlights, I just, I can't stop listening, because I'm like, you're really curious about how they got Yeah. And the beauty of it is I'm also passionate about, you know, helping them succeed. So if I take their time listening through the whole process, I try to connect them with somebody that can get them to the next step, either a business broker, like yourself, or somebody that I know that could, a lot of those mom and pop shops like that tire thing, it just as they don't have 10 employees, they don't have the revenue, he does, you know, 300,000 a year, but by time you pay for insurance and maintenance, and you know, his service tech and everything else, you know, it kind of eats that up and buy your tires and everything. But it would be a great add-on for somebody that's already got a mobile service that's already going on and fixing cars or whatever. So I know a couple of those mobile mechanics. So, um, you know, so in the area of like mergers and acquisitions of ship, jump right back into this, what areas aside is just so many different things, you can liquidate them by taking them public, we can do the roll-ups like I'm involved in these international roll-ups and stuff. What areas are interesting to you right now that you're learning about, you're looking into growing into what has your interest currently,

Josh Ploch 26:44  
the two that I focus on, mainly, well, probably three, and you know, this really just, again, is broker's personal experience, you know, so this is based around just where I came up, and what I've spent a lot of time but the three areas that I focus mainly on are manufacturing, because I spent a lot of time in manufacturing, specifically in that, you know, value chains and people looking at expanding their reach up and down their vertical, you know, picking up different steps along the way. I really like the online business space. So drop shipping, FBA, things like that. And then restaurants are the third. So

Ronald Skelton  27:27  
go ahead, those FBA is a drop shipping businesses, they're going for crazy amounts right now, I have, I have a friend who that's what he does, he buys themselves. And he, I mean, to the point, I think he's got $16 million worth the NBA, you know, revenue, and his portfolio. And when he goes that he's having a hard time buying anymore, because like they're wanting, you know, 1012, you know, 14 times revenue, and he just doesn't want to wait that long to get his money back. He's never had to pay that much for but it's kind of insane. It's almost as hard as the software as a service business.

Josh Ploch 28:02  
Yeah, you know, part of the value and those is really part of the challenge in traditional businesses, right? When those are set up, you know, oftentimes they're set up to be very low maintenance, you know, so either the owner is not involved, or the owners involved very little. So when as on the buyer side, it's so easy for you to see the value in the return and to see how it fits into your system. So all of the challenges that you have in a mom-and-pop type operation, you know, from when you're looking to exit and the buyer side, you're almost pre packaged in these FBA businesses. So I really think that's one of the reasons why you're seeing, you know, those become so popular, and obviously, they're location independent, you know, things like that they, they had a lot of other kind of peripheral values. But, you know, they are really set up for entrepreneurs and investors just in their structure by default.

Ronald Skelton  28:58  
Cool. So I always like to ask, if we have asked some decent questions here, I know, I've had a couple of copies of stuff. What questions should I be asking you? I mean, you're the business broker, your serial entrepreneur, you own franchises, you know, what should we be talking about inside of acquisitions and mergers, buying and selling businesses?

Josh Ploch 29:22  
What I'm most interested in, you know, on the side thing outside of the granular, you know, is where's the world going? And what does that look like, you know, as we continue to be more location independent, you know, as, as COVID doesn't return people to the office. You know, as we change the administration does not get to get into political stuff, but, you know, where, where is the industry going, you know, where is manufacturing going? Where, you know, is the thought leaders going, you know, what's this look like? Who's winning? How are they winning? then that's what I spent a lot of time just studying and keeping an eye on, you know, and then inside of that, how we can help people really get to the next level and, and reach their goals.

Ronald Skelton  30:11  
Awesome. So, is there any piece of advice you would consider most important if somebody is starting to look at? I think I want to sell this, like, how far back should people plan? I know what I'm thinking that that answer is, but how far back? Do you believe that a business owner should start planning for the exit? And what are some of the things they should probably do to prepare for a meeting? You are a guy like me?

Josh Ploch 30:38  
Yeah. So certainly, you know, we look back, we like to look back at three years tax returns, that's the cut and dry answer. So really evaluating those from that structure standpoint, but really looking at, again, are you running this as a? Do we use Mom and Pop as a right as a bucket descriptor? But, you know, are you running it like that? Or are you running it like a corporation? So a couple of things that I like, to really have people look at is, you know, keep an eye on your finances? What's that look like? How linked? Are you personally, to what's going on? In the business? And from the aspect of, if you're not there? Can a CEO sit there? Can the CEO sit there? You know, can that change be really obvious? Or do you run everything through your personal credit card? And you know, you're just completely intertwined? So is there a separation there between you in the business? To succession planning? Right? So if you're going to exit, you know, are people ready for you to be out of that seat and somebody comes into that seat that doesn't really know or has a learning curve? You know, do you have those people in place that are going to not just be able to maintain it, but to be able to grow the business, because that's what you know, the next buyer is going to be looking for. So work on your succession planning, you know, are you ready or again, are you somebody that keeps everything really close to the vest, because that just makes for a tough sale, you know, and third, if you have staff, you know, if you have 510 15, people, you know, start to prep them, that goes massively overlooked. And it's one of the biggest things that can really make a transition difficult. You know, especially again, if it is a family-type business or an owner that's been there for a really long time, you know, they feel like they're part of the family. So if that person exits, you're going to feel like you lost a family member. So, you know, the owner, the broker, you may spend a lot of time, you know, hammering down on financials and revenue, and ROI and add-backs. But you know, there's 50 people here that just feel like they lost their favorite uncle or their favorite dad or something like that. And, you know, there's, there's, oftentimes, that part is just massively overlooked in the transition. So I really spend some time, you know, thinking about that. And that may mean that you start talking about it, you know, you may start planning it, again, each company is different, each culture is different. So each person has to answer this for themselves. But, you know, whatever that looks like to prepare your staff and to prepare that business, you know, whether it means Hey, I'm gonna have a retirement party, you're gonna retire in three years, or, you know, Hey, everybody, we're starting to look at this, you know, so that that isn't a shot. That that will just make it easier for you, for them for the new buyer. Everybody is involved.

Ronald Skelton  33:33  
So what I'm hearing is three years, if you're really planning on doing this three years, you're gonna look back three years, I look for three years traveling financials also. So at a minimum, I think people should prepare. I mean, I honestly think people should run their business as if it's for sale. But as the, you know, if you're thinking about retiring in the next five to 10 years, you know, or whatever, I honestly think if you're thinking about retiring next year, you're a year behind, you really should like the three-year mark, so when I looked at, start doing your taxes to you know, show the financial strength of your company, instead of trying to write every single thing off, right, start grooming the to the management to be a replacement, and even take vacations, do what it takes, like, go away for a couple of weeks, come back and see what's left undone train. So you're grooming the next generation, of leadership inside of the company. And the piece that I didn't realize, and you brought a very keen point is I guess it's your HR background, cuz you've probably seen this happen a few times, right? Is how do you know starting the discussion with a team? And I think there's a myth out there like a lot of times there's all these NDA sign and it's hush, I have to go look at a business under the guise that I'm an insurance adjuster or whatever story they tell people like I've been about just about everything right? Showing up at a business site, and never the acquiring new owner. So I think there's a myth around that. To that, you know, if they tell everybody it's for sale, people run scared and leave. I think if that's handled, right, or if they have somebody like you or somebody to work with them on that language on that communication, it makes it a lot easier when a guy like myself, brings in a team to, you know, take over a business that we had acquired.

Josh Ploch 35:20  
It does, and like you said, that is the myth, right? Everybody's gonna run away. But, you know, really, what we see when it's done well, is, you know, if you have employees that have been with you 1520 years, they really want you like, they want you to be able to retire. Well, you know, they want the business to be able to transition well, so they, you know, they will be your best allies, you know, you can get to the point where you're handling it? Well, you know, and that is, you know, you think, oh, everybody's gonna get a run, for sure. But, you know, really, it's the opposite. If you can do it, they do have your best interests in mind, you know, as the current owner that they've worked for 30 years, you know, they do, you know, their, their identity oftentimes is linked to the business, you know, they very much want that to be successful for years to come. You know, and they will, they're going to be what makes it successful through that transition.

Ronald Skelton  36:13  
Awesome. So, we're running to the end of the time we have available so how would you like people to reach out and contact you? Joshua, oh, it's the Murphy's right you on the what's the official name is Murphy's.

Josh Ploch 36:31  
Yeah, Murphy, business brokerage,

Ronald Skelton  36:33  
Murphy, Business Brokers, okay. I have seen some titles where they talk about something else inside of the financials or something like that, but mostly, say you own the local Tulsa franchise of Murphy's business brokerage. If somebody wants to talk to you about, you know, take a look at their business or, or just ask you questions in general, how would you want them to reach out to you?

Josh Ploch 36:53  
Yeah, and I could send this to you to add, but my email is just J dot block, P Loc, H, and Murphy, business calm.

Ronald Skelton  37:01  
Cool. And then I have your LinkedIn those that okay if people see your LinkedIn thing, it is. Alright. So we'll put that up there real quick and make sure I didn't mess that up. But that's what it said on LinkedIn. When I went, there's jokes, right. Yeah. So that's underneath me. But that's his mind was out there earlier. For those of you guys that are on the podcast listening, just simply go to LinkedIn and search for Josh Ploch. And that's how you're going to find him on there. And you'll see he does all kinds of stuff. You speak at HR events and everything else. So do you have any final words of wisdom or something we should know about you or your brokerage or anything like that before we go?

Josh Ploch 37:46  
No, just you know, everything is possible. You know, there are plenty of options out there. So don't listen to anybody that says one thing can't happen or another thing can't happen. You know, one foot in front of the other and we want everybody to be successful.

Ronald Skelton  38:02  
So step one is call us. Step two is you'll find out what's possible for him. Right, exactly. Awesome. Well, thank you for being on the show today. And we appreciate it, man, we really do. Alright,

Josh Ploch 38:13  
thanks for having me.

Ronald Skelton  38:14  
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