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- Thread starter Steve19
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I'm sure many factors led to this, but I've noticed this one prevalent in the failure of many conglomorates/corporations:
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muffler dragon
Bien. Bien chiludo.
I don’t know/have any figures on the number of companies that PE has destroyed because of their decisions, but they definitely make the news more often.
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BuckBackHome
Wolverine is largest member of weasel family
Sadly, I don't know if PE sees their actions as destruction because they still make money, which is their goal.
A few years back my eye doctor sold his practice to PE. I ordered some contacts for one of my kids. Their price was about 300% higher than what it was right before the sale. I just looked at the office manager and she suddenly told me they will meet any other advertised price and she found a price just like the one I had paid a few months prior from WalMart. This was a couple of years ago. I haven't ordered contacts from them since.
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muffler dragon
Bien. Bien chiludo.
It's evident to me that PE makes money regardless of the outcome.
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calibuck
Too soon old, too late smart
Hey, this isn't the first time something like this has happened. Quite profitable, actually. Schwab had built a great brokerage firm. Sold out at a premium to BofA, and then about ten years later, when BofA 'restructured', Schwab bought back his firm for pennies on the dollar. Heck, if they spin off Hooters to John Daly, he could probably put them back into profitability all by himself. Any other examples you/we know of?
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PE is coming farther and farther down into main street and yes, the downside is typically a degradation of service and that small company feel we are used to with locally owned, mom and pop type businesses.
The trade off though, is that the vast majority of those businesses would be going away if someone didn't step in to be the succession plan that the Boomer owners don't have. Think of things like your local HVAC, garbage collection, plumbers, Doctor offices...all of these (and more) are the type of things some Boomer has made a nice living off of by providing a good service to a small market. Now that Boomer has to retire somehow (father time is undefeated) and that otherwise healthy little business is at risk because 1) there are not enough people to take them over, 2) it's very difficult for people who would want to take it over to obtain the kind of financing that makes the deal make sense for both parties and 3) there is an even smaller section of that smaller work population that has the skills these jobs require.
Small business ownership is the best path to wealth in this country and the vast majority of people who could do it with the right support (training, education, financial) are going to get locked out of it because PE is going to step in. Not because they are heartless monsters but because of demographic and economic trends.
It's a massive issue underlying the already choppy economic waters, it just doesn't get the press
The trade off though, is that the vast majority of those businesses would be going away if someone didn't step in to be the succession plan that the Boomer owners don't have. Think of things like your local HVAC, garbage collection, plumbers, Doctor offices...all of these (and more) are the type of things some Boomer has made a nice living off of by providing a good service to a small market. Now that Boomer has to retire somehow (father time is undefeated) and that otherwise healthy little business is at risk because 1) there are not enough people to take them over, 2) it's very difficult for people who would want to take it over to obtain the kind of financing that makes the deal make sense for both parties and 3) there is an even smaller section of that smaller work population that has the skills these jobs require.
Small business ownership is the best path to wealth in this country and the vast majority of people who could do it with the right support (training, education, financial) are going to get locked out of it because PE is going to step in. Not because they are heartless monsters but because of demographic and economic trends.
It's a massive issue underlying the already choppy economic waters, it just doesn't get the press
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