When you run a business, you will often have competition that you need to try to beat by doing better work or charging less.

What would you do if your competition survived by being dishonest and underbidding jobs but overcharging on them when they were done.

That is what the business owner in this story had to deal with, so he worked with an out of state attorney to buy out the other business and fire the owner.

Check it out.

Want to undercut me on a job by doing shady and poor work? Fine, just wait and see.

I was an observer in this whole affair but to say I didn’t enjoy the the story would be a lie.

Company A did fencing/walls/barriers etc Company A was ran by Bob. Bob was a real upstanding guy, took over the business from his father and really grew it into something big.

Bob had an employee, Jake.

Jake had been with Company A for quite a few years but Bob and Jake always rubbed off on each other in the wrong ways.

Bob always felt like Jake was the king of shortcuts and shoddy workmanship.

When Bob took over the company from his dad, Bob applied more pressure on Jake to bring up the quality of his work or be let go.

I don’t think this is going to go well for Jake.

Eventually Jake got tired of the the increased pressure and quit and formed his own fencing company called Company B.

Here is where I come in, I started a job in a company providing business services to small to medium sized businesses in the area and both Company A and Company B became my clients.

This was several years after Company B had formed.

From my outside view point Company A was that local company that’s been around forever that does good quality work that you can trust but they aren’t going cheap, they never try to be cheap, but you can trust them.

These companies don’t usually last very long.

Company B was the young start up who was cutting corners and being competitive in every way possible, often by lying, or misleading its customer.

That’s when company C comes in, Company C was a building a production facility in the area and wanted a wall with gates around its new production facility.

This was going be a BIG contract and really the only two players in the area that could possibly do this job was Company A or company B.

This contract was worth a lot, if my memory serves me correctly the job was somewhere near 7 figures.

Company A and Company B went to go bid.

Company B came in at like a 30% lower price point and even though Bob tried to explain it wasn’t possible for Company B to do the work that was promised at the price point that was given.

Of course money talks and Company B got the contract.

I remember Bob was furious, in his eyes he felt what Jake was doing was wrong, he didn’t mind fair competition but Jake’s MO has always been way underbid, over promise, rely on cost overruns to make a profit.

Bobs opinion on business was a price is a price and if he says he’s going X for Y he’s going do X for Y even if he losses money.

Its how he was raised.

Some time goes by, and Bob gets a call from company C, they’ve apparently fired Jake and his company due to not being able to do the work required and ask Bob if he can come in and fix the mistakes.

Bob agrees, and gets the job done.

At this point Bob starts thinking, he’s got to take Jake out. Jake is taking too much money out of his pocket.

Bob comes up with the idea of buying Jake out.

But Bob knows if he approaches Jake regardless of what he offers to pay Jake is going say no.

So, Bob has got to be smart.

Bob is talking to me about this during one our meetings, we had become quite close.

A good attorney can be invaluable.

And I tell Bob “I bet there are lawyers out there who specialize in helping other companies acquire other companies.”

Bob asks me if I know of any. I don’t but I did have a client who specialized in business law who would be more familiar with this whole thing.

I give Bob his contact info and Bob thanks me.

Bob contacts the lawyer and tells the lawyer what he would like to do.

The lawyer tells Bob a lawyer who used to work for him now works for a firm that specializes in mergers and acquisitions and if Bob wanted to buy out Jakes company he’s confident this firm could get it done.

Also this firm was in the big city far away from their small community so its unlikely Jake would know what’s truly going on.

Bob contacts the firm and says he wants to buy out his competitor and would like to enlist their services.

Now this is already getting a bit longer so I’ll get to the point.

This firm ended up buying Jakes company, lock, stock, and barrel and gave the company to Bob.

All the while Jake was completely oblivious to the fact that his arch enemy has just acquired his very own company.

I recall Bob describing to me the day he walked into Jakes company with such delight.

Bob was told he owned the company, Jake had been paid and was expecting to meet the new owner of the company that pleasant Monday morning.

Jake was given the title of General Manager. And was considered 2nd in command now.

I bet he was very excited to have this conversation.

So, Bob walked into the building that once belonged to Jake with his documents and the lawyer that had helped him acquire the firm (Who Jake was familiar with) Bob walked into Jakes office to Jakes surprise

Jake: Hi Bob

Bob: Hi Jake, how are you?

Jake: I’m good, what are you doing here?

Bob: O nothing much, just thought I’d come check out my newly acquired business

Jake: Uh?

Bob: Jake, you sold your company to me

Jake: I did what? No I didn’t! I sold it to XYZ

Bob: XYZ is the law firm I hired to organize the transaction. I am now the owner.

Jake: That’s a lie.

Bob: Here’s the documents, (lawyer who Jake was familiar with confirmed this was all true)

Jake: So your now my boss?

Bob: yes, now get up, that’s my chair and I’m tired I wanna sit down for a minute

Jake: This is my office

Bob: This is my company, and I have decided that this office is now my office so I’m going need you to get out of my chair.

Jake gets out of chair.

Bob: Great, well have a sit Jake

Jake: Thanks

Bob: Jake I think the first order of business today is getting rid of redundancies

Jake: What do you mean?

Bob: Well you see Jake whenever a company acquires another company you get overlap, redundancies.

Two HR departments, two sectaries, two accountants, etc.

But now its all one company, so now you got redundancies, overlaps, which is quite frankly a waste of money.

Jake: Yea…

Bob: And I don’t need two owners working for one company, (and he laughs and tells me he had the biggest grin on his face) Jake, its become apparent that your services are no longer required and effective immediately you are terminated.

Jake: Protested

Bob: The decision is final, you may collect your personal belongings and leave the premises, what time did you get to work this morning?

Jake: 7 AM

Bob: Great, so you’ve been here for 2 hours, I’ll make sure payroll pays you out for 2 hours on the agreed upon rate in the buy out agreement, have a nice day.

He is finally catching on.

Jake: So your just firing me? Just like that?

Bob: Yup, should have done this long ago

Jake: what about my family?

Bob: Jake, I just bought your company from you and paid you a lot of money, you’ll be fine. Now get out of my office and out of my building.

And that is how Bob acquired and fired an employee he should have fired long before

That must have been a very satisfying conversation, and Jake actually made out pretty good as well so it is a win-win for everyone.

Take a look at the comments below to see what other people have to say about it.

Jake likely was entitled to more.

Hopefully this was prevented in the contract.

Healthy competition helps everyone.

Yes, Bob was the better man.

This person points out that a non-compete clause is needed.

This story had a happy ending for everyone.

Well, almost.

If you liked that story, check out this post about an oblivious CEO who tells a web developer to “act his wage”… and it results in 30% of the workforce being laid off.