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OK at Work, hosted by Offit Kurman attorneys Russell Berger and Sarah Sawyer, is a weekly podcast that discusses current events and legal issues impacting business owners. From updates on the ever-changing employment law landscape to the risks and benefits of integrating AI into your workplace, subscribe to stay up-to-date on issues and events that may impact you and your business.
Sarah Sawyer: Welcome to this week's
OK at Work with myself, Sarah Sawyer,
my colleague Russell Berger, both
attorneys at Offit Kurman, and today
we are talking about businesses,
the economy, what we're seeing.
So obviously a lot of our clients are
in the business of, buying and selling
their business, so they might be on
the sell side, someone's looking to
get out of their business and sell
it, or they might be on the buy side.
And definitely a lot going on
just in the marketplace right now.
With some uncertainty around the economy.
Some banks are seeing that and
uncertainty always creates a lot of
havoc in the business world and in the
financial regulatory industry and with
banks and all of that kind of stuff.
So we're definitely seeing that impact
on our clients and the impact on the
structure if they maybe want to sell
their business and getting creative in
different ways, maybe extending more
seller financing and, trying to secure
that with property that they're selling.
But what are some things that,
clients should be keeping in mind?
Businesses should be keeping
in mind when we're dealing with
this kind of uncertainty when
they might be making moves as it
relates to their business, Russell?
Russell Berger: Yeah, as lawyers,
I think we're planners by nature.
So this is easy for us to
say because at least for me
anyway, it's a default setting.
When there's uncertainty and
there's questions out there, I
think it's worth taking a little
bit of time to try to bring as much
certainty to the mix as you can.
In one way, obviously can't control the.
The national, their global economy.
But, can you put yourself in
a little bit better position?
Can you take the time to make sure your
contracts are a little bit tighter?
You get a little more security, you're
taking a little bit less credit risk
with customers, and if you do go the
route of, getting security, are these
things secured interest, like UCC secured
interests are these things where you need
to go through a formal process to perfect
your lien or your position on something.
Because right now, maybe it's worth
doing that because especially given
your industry, whatever that might
be, there may be enough uncertainty,
like, Hey, I don't normally do this.
It's outside my ordinary course, but right
now, I think it might make sense to put
myself in a little bit better position,
so hopefully nothing bad happens, but
if it does, I'm protected or I'm more
protected than I might otherwise be.
Sarah Sawyer: We talked
about this a little bit with
contracts in general as well.
I think people are taking an even closer
look because when you're going to buy a
business to say you're trying to project
out based on prior performance, well,
alright, how's this business gonna do?
What's the hell of this business?
What does that look like?
And you always wanna look very carefully
at that, but right now it's even a
little bit more uncertain and with
tariffs and different things that are
going on that there's a lot to look at.
It's a lot more difficult to
plan out that future contingency.
So I feel like there is gonna be a lot
more looking deeply at the contracts
that that company that you're acquiring
might have, and then also the agreement
itself on the purchase side saying,
alright, well maybe we wanna hedge
a little bit because performance is
uncertain based on all these factors.
So I think the contracting side of
things, there's gonna be way more
diligence as well in looking at, hedging
your risk and trying to plan that
uncertainty depending on the industry.
Russell Berger: Yeah.
When the economy's going great, you
can take more risk because there's
less things that are putting, cash
flows and business valuations at risk.
When there's uncertainty, like I
said, maybe that'll still work out
to be the case, but we don't know.
We can see, some money
starting to tighten up.
So yeah, do your homework.
If you're on the buy side and if
you're on the sell side, shine
things off as nice as you can.
Go that extra mile because
there will be a return on it.
Sarah Sawyer: Well I think there's a lot
of room for creativity in that as well.
So you can see it as a negative thing
and be cautious, but also there's
some positivity there as well.
So I think there's ways to be creative
and be thoughtful in your approach.
Thanks Russell, and
we'll see you next time.
Russell Berger: Thanks Sarah.