Congrats private equity is coming for your local plumbers, electricians etc

[Anonymous]

I was surprised when I hired a catering company that was bought out by PE. Was wondering why the costs were so high and yet the food wasn't as plentiful as expected. Went and read their mission statement later and bam. Original owner was no longer.

[Anonymous]

Is there a way to find out which companies are doing this? I try to look on website, and it is more miss than hit to glean any info.

Our HVAC guys are still 3 dudes and a truck, and I have leaned on them for recommendations of non-PE owned other tradesmen.

[Anonymous]

I work in a very niche service based industry and PE just bought the first business in our world. I was pretty shocked.

[Anonymous]

PE is coming for youth sports too.

[Anonymous]

PE is getting into everything and it's only hurting us as consumers and other smaller, independent businesses as they struggle to compete.

Veterinary practices are one were PE has scooped up a ton of smaller, independent firms. Our local vet is still independent and we are continuing to support them. Friend from HS is also running an independent practice as well.

Youth sports have been mentioned - Pioneer Sports & Entertainment now control two youth soccer organizations with Surf Sports & Rush. Control the clubs, the facilities and the travel groups to book the hotels, etc. They are now nationwide, coast to coast.

Pharmacies - how many independent pharmacies are around any more? Another HS friend is a pharmacist and owns several locations - he's managed to do well despite PE because of the services he provides. Free Delivery, stocking more obscure meds, etc.

It sucks that everything is control by these huge conglomerates with some shady dealings - read about Clearlake Capital and Wheel Pros shuffling money around.

[Anonymous]

Government intervention needs to break up the monopolies. Won't happen under the current administration, hopefully the next one

[Anonymous]

Sometimes these places go out of business because PE can’t give us what we want.

In my town, PE bought a small chain of previously family owned liquor stores. The stores were successful and the owners were committed to the community and believed in their products. They hosted events, welcomed wine clubs, brought in speakers, etc.

PE did none of that and had no interest in the product. The whole chain is now going out of business just three years later.

[Anonymous]

The weakness of PE is that the owners are far away.
So you pay the workers to use company equipment off the clock.

This doesn't work for doctor's offices, though.

[Anonymous]

Anonymous wrote:This feels so hopeless. What's the answer? Government intervention?

Anti-trust law enforcement, yes.

And small business tax credits.

[Anonymous]

Private equity is the worst. They're akin to satan incarnate. I refuse to use any veterinarians or dentists that were bought by private equity.

PE is gobbling up practices, forcing them to buy the latest machines that they don't need (and PE gets a kickback on the machine purchases), they take on huge debt to afford these machines and then raise prices astronomically. And then they pay all the doctors less and less.

[Anonymous]

Anonymous wrote:Sometimes these places go out of business because PE can’t give us what we want.

In my town, PE bought a small chain of previously family owned liquor stores. The stores were successful and the owners were committed to the community and believed in their products. They hosted events, welcomed wine clubs, brought in speakers, etc.

PE did none of that and had no interest in the product. The whole chain is now going out of business just three years later.

Story as old as time. This is a fake bankruptcy after they forced them to take on debt they could afford.

[Anonymous]

Where do we look to see if a compare are working with is owned by private equity?

[Anonymous]

Where do we look to see if a company we are working with is owned by private equity?

[Anonymous]

Anonymous wrote:PE is getting into everything and it's only hurting us as consumers and other smaller, independent businesses as they struggle to compete.

Veterinary practices are one were PE has scooped up a ton of smaller, independent firms. Our local vet is still independent and we are continuing to support them. Friend from HS is also running an independent practice as well.

Youth sports have been mentioned - Pioneer Sports & Entertainment now control two youth soccer organizations with Surf Sports & Rush. Control the clubs, the facilities and the travel groups to book the hotels, etc. They are now nationwide, coast to coast.

Pharmacies - how many independent pharmacies are around any more? Another HS friend is a pharmacist and owns several locations - he's managed to do well despite PE because of the services he provides. Free Delivery, stocking more obscure meds, etc.

It sucks that everything is control by these huge conglomerates with some shady dealings - read about Clearlake Capital and Wheel Pros shuffling money around.

This is sad/scary. I've noticed how veterinarian costs skyrocketed once private equity took over, and plumbers and electricians have always been $$.

[Anonymous]

Anonymous wrote:In fairness…I know many somewhat successful small business owners who don’t really have any exit plan. They thought their kids may take it over, but their kids saw how much work and time away from the family it took (not to mention the physical pain) and are all saying no thanks.

It’s not easy to find a buyer for these companies…their competitors aren’t exactly flush, so PE is one of the few buyers.

Perhaps these companies should wind down into retirement and then new small businesses can open. If every small business sells out to PE, then the next generation is screwed from ever breaking into the market. This is where we need regs and tax laws that disincentivize PE taking over these businesses.