Great business with Union labor

searcher profile

November 16, 2020

by a searcher from Columbia University - Columbia Business School in Princeton, NJ, USA

Any experience or thoughts on a target business with union labor? what are the pros and cons?

0
8
222
Replies
8
commentor profile
Reply by an investor
from Hobart and William Smith Colleges in Dorset, VT, USA
Assume you are stuck with them unless the business fails and you can restart without a union. OR you can somehow get them to decertify in your acquisition which is close to impossible. Some unions are great and some will feel like you are negotiating with Isis. I would read the CBA, meet with shop president and local leader at HQ and try to get a sense of who you are dealing with. And get a sense of the national union and their approach - some are terrorists who delight in shutting down factories to scare everyone else in the industry into compliance while others have very little interest in how the local shops operate. The good union situations are great in that they can provide you with trained and reliable labor at fair prices. Unfortunately, those are hard to find.
commentor profile
Reply by a searcher
from Drexel University in Baltimore, MD, USA
Consider partnering with them. Also out of the box idea would be to offer the employees some of the equity within the deal (maybe through a phantom equity grant check out http://www.phantomstockonline.com/) that way the fight is not with ownership or management (since they would in fact be the former and be served by the latter) rather with the market and critiquing the business plan. My experience is that with the right approach unions can be catalytic within a business and could even be a true partner DURING the search phase. It's just all about setting up the right incentives.
commentor profile
+6 more replies.
Join the discussion