Buying Your First Business: Tips From Mike Kadinger, Sioux Falls Outdoor Equipment

Owner of Sioux Falls Outdoor Equipment, Mike Kadinger

Have you considered buying a business?

In some situations, it can be an excellent opportunity that becomes available or even a new career goal. Of course, the leap from employee to owner carries a certain amount of risk and greater responsibility. And there is a lot to consider. Mike Cadingerowner of Sioux Falls Outdoor Geargot the chance to buy the company he had been working with.

Sioux Falls Outdoor Equipment is a successful local business selling new outdoor electrical equipment for lawn and landscape maintenance. Committed to excellent service, they have grown to be one of the largest dealers in the Sioux Falls area.

A first time entrepreneur, Mike bought his business 1-1/2 years ago when the owner was ready to move on after 25 years. To encourage others who may have the opportunity to buy their own business, here are a few tips and lessons from Mike that he’s learned over the years as a new owner.

Navigating heightened risks as an entrepreneur

Getting promoted from employee to owner not only adds to your list of responsibilities, it also greatly increases your risk. First, you leave behind a stable salary and a 40-hour work week. Second, you have a business to sort out and now people depend on you for their livelihood. Perhaps only those who have made the leap themselves can truly understand what it takes. But for those who haven’t, it doesn’t take long to understand that a Business owner wears many hats including responsibilities for: finance, marketing, technology, personnel, etc. Its success or failure will depend on the decisions you make as the owner, it is under a lot of pressure and should be a factor in your decision.

In addition to the obvious financial risk that an owner takes, there are also relationship risks. I had been in this industry for a few years and worked at a company that did business with the company I eventually bought, Mike said. It was a bit nerve-wracking at first, but I talked about the idea with friends and family, and they offered a lot of support that helped me make the decision. The owner of the company I worked for also helped me as a mentor and encouraged me through the process. Communication and trust play an important role in navigating the success of the purchase transaction and successfully running your business in the future.

Build on your company’s strengths

Sioux Falls Outdoor Equipment specializes in selling high-end outdoor and landscaping equipment from companies such as Exmark and ECHO. About 75% of sales come from commercial customers, with the remaining 25% being residential, Mike said. From a sales perspective, we were very niche oriented. This is not a huge market, but it is highly specialized.

Sioux Falls Outdoor Equipment is known for their excellent quality of service, which has made them one of the best dealers in the region. Providing that level of service requires product knowledge and certification from companies such as Exmark, ECHO, Kohler, Kawasaki, Honda and Briggs, to name a few. Commitment to quality is our top priority, says Mike.

Besides the quality of service is timeliness. I think a lot about the maintenance that still needs to be done. I just hired a mechanic, so that helps a lot. I would also like to add another employee, but then I plan to keep the business small to ensure we can continue to provide first class service.

Be aware of what you can and cannot control

Develop good relationships with suppliers.

For any business, suppliers often provide the essentials needed to keep it running. Companies that sell physical goods know that it can be difficult to balance growth volume with available supply.

The biggest challenge beyond my control was having enough inventory on hand to handle the volume. The recent supply chain issues impacted our ability to get products to our customers, Mike said.

While recent stock issues related to Covid continue to improve, it only makes sense to build strong relationships with your suppliers so that they go the extra mile for you if you ever need them.

Manage your time wisely.

Successful people have learned to work smarter, not harder. As a leader of a company, being able to manage your time (and possibly your team members’ time) will help you run your business better and reduce burnout. Many business owners I’ve met have spoken about their challenges with not having enough time, but time management and organization were key for me.

Time management activities such as planning ahead to prioritize tasks by importance, allocating time on your calendar to complete them, or building daily routines to provide structured productivity can help.

Everyone’s system is unique and it may take several tries to find the right system that works for you. your business. The bottom line is: time is money. It’s worth figuring out how to deal with it.

Make time for professional development

Although Mike had experience in the industry before buying his company, the need to learn different aspects of his business became apparent. If the business is just starting out, you hire consultants, employees with these skills or you learn them yourself, which is where Mike started.

• Technology: From a technical perspective, he researched and installed dealer management software that tracks dealers and service work.
• Finance: As the owner and responsible party for finance, he looked for accounting software options and selected QuickBooks. Mike learned how to use it and now manages the financial aspects of the company.
• Marketing: In order to find new clients and grow the business, he donned his marketing hat to design the company logo and business cards and handle most aspects of advertising.

The key to safely growing your business is understanding that there is a limit to what you can learn on your own and when to hire an expert.

Should I buy a business?

When asked what advice he had for others looking to buy a business, Mike was quick to respond. Do it. Try it, especially if you’re young, Mike said. If it fails, there is always time to recover. Owning a business has had a positive financial impact on my family and me.

We asked Mike what Bank Midwest could do to better serve Sioux Falls Outdoor Equipment. I wouldn’t change a thing, Mike said. Bank Midwest meets our needs well.

Contact Sioux Falls Outdoor Equipment for your lawn care or landscape maintenance needs. You can visit them at www.sfoutdoorequipment.com.

Whether you are just starting out as an entrepreneur or have been in the business for a while, please visit the Bank Midwest locations near you to find an investment banker who can help you grow your business.