The pandemic has affected different people in very different ways. Sectors such as hospitality have been hit incredibly hard and many thousands of people have lost everything they own through no fault of their own. Other sectors including estate agents, letting agents and indeed business transfer agents have continued to trade very well and those of us who work in these sectors should give thanks for our good fortune. However, this does not mean that we have been unaffected by Covid-19.
Most of my clients know someone who has died or someone who has been seriously ill as a result of the virus. Many more have been affected by loneliness or depression. However, one of the most common problems is overwork.
During the first lockdown, many of us tried to keep our spirits up by using all the extra time that we had available to do worthy things. The logic was that if we were saving ten hours a week by not commuting to work, we could use it to get fit or to learn a foreign language or to spend quality time with our families. But as the months have dragged by, most of us have abandoned these good intentions.
The problem for many people is that we can’t do so many of the things that give us joy. Spending time with friends and family, playing football, going to concerts or the theatre. Most of our leisure activities have been curtailed. This problem has been compounded by the fact that if we do not plan exciting things to do with our leisure time, then work has an awful tendency to expand to fill the void.
So many of my clients have really struggled with this. Working from home with poor IT, slow internet and no admin support means that many jobs take much longer than they used to. A great many people are working from a desk in their sitting room or bedroom and when your workplace is always within view, it is all too tempting to keep on answering emails long after the time that we used to go home and many agents have been extremely busy dealing with the sudden and unexpected boom in the housing market that followed the first lockdown.
I have certainly felt all these things in my own business. Since Christmas, we have been extraordinarily busy dealing with clients who wanted to sell their business before the Budget due to fears about a rise in capital gains tax.
Business sales are stressful to deal with and the last week or so before the sale completes is particularly difficult to manage. The most common problem is agreeing the completion accounts which have to be agreed in the last few days of the sale. Most people think that selling a business is all about getting the best headline price but this is simply not true. It is very easy to lose 15 or 20% of the price agreed due to the way that the completion accounts are prepared. Accountancy terms such as ‘accruals’, ‘pre-payments’, ‘normalised working capital’, ‘adjusted EBITDA’ and ‘allowances for fees taken in advance’ are words that most estate agents and letting agents have never come across before but they can mean tens of thousands of pounds difference to the net proceeds that they will receive from their sale.
As completion day approaches things can get quite heated and after the big issues have been resolved, it is all too common to see both buyers and sellers getting caught up in minutia. Most estate agents have lost a house sale due to an argument over a pair of curtains or a manky old carpet and business sales are just the same.
I dealt with an issue like this on the night before the Budget. The buyer and the seller had been arguing all day about the completion accounts and the seller was getting very petty. At 10pm, he demanded an extra £10,000 as payment for the office furniture – on a sale at over a million pounds. I rang the buyer fearing that we would hit deadlock over this but instead he told me this wonderful story. He said:
“This situation reminds me of a house sale that I dealt with several years ago. The price agreed was several million pounds and somehow on the day before exchange of contracts, the buyer and the seller got into an argument about an old ride-on lawnmower. The buyer insisted that it should be included in the sale and the seller would not have it. Discussions got so heated that I feared we would lose the sale so in desperation I offered to buy a brand new lawnmower for the purchaser out of our commission. The purchaser’s response to this generous offer was that he didn’t want a new lawnmower, he wanted the lawnmower that was there already. The dispute was clearly no longer about the lawnmower, it had become a battle of the egos.
I went back to the seller and offered to buy him a brand-new lawnmower but I got the same response. ‘I don’t want a new lawnmower,’ he said, ‘I want the one that I’ve had for the last ten years.’ I asked him to consider if it was really worth losing the house sale over an old lawnmower and left him to calm down for an hour. Fortunately, he saw sense and I thought that the matter was closed.
Contracts were exchanged and four weeks later, the buyer arrived at his new house. The first thing that he saw as he pulled into the drive was the lawnmower. The seller had driven it into the garden pond with just the seat sticking up above the waterline!”
I don’t know if it was just the stress of my pre-Budget workload but I laughed so much at this story that my sides hurt. Then I tried to repeat the story to the business seller but I got such a bad attack of the giggles that I couldn’t get my words out. I therefore had to email the story to him. Fortunately, the story did the trick and the sale completed at the price agreed with all the furniture included in the sale price.
In these awful times, a good laugh can be a truly wonderful way to release stress and lift our mood so let me ask all of you a favour. If you have your own funny story like this one to tell, please can you write in and share it with us? It really could make someone’s day.
Adam Walker is a management consultant and business transfer agent who has specialised in the property sector for more than thirty years.