By Allen Markowitz and Allan Gerber
Succession planning not only takes years of thought and planning, but also a good deal of gut-wrenching decision-making, for which many of us are not prepared. We see this over and over again while speaking with the younger generation at our seminars who are genuinely frustrated that there is no plan in place to continue a family business when the time is at hand.
Our own business actually had a succession plan, (we owned a five-store chain and one service center) and believe it or not, we did not execute our plan for nine years, until we felt the time was right. During all of those years we continued doing business as usual, but knew that our plan was in place.
Many of us have been in the industry for a very long time. If we do not have family members who are not only interested in continuing the business, but are actually capable and motivated enough to do so, then what a better way to end our careers than a buyout by a company that can actually pay us a fair price for our years of hard work?
Succession planning is not as easy as you might think; perhaps this is why so few of us actually prepare. The initial dilemma is how to place a value on the business? What about all of that old inventory, we might feel that it is worth big bucks but I guarantee someone valuing your business may have a different point of view. Next, we have aging computer systems, beat-up vehicles and on and on. While all of these things work well in our world, they may not have much value to a suitor and may even be a liability especially if there is a cost to replace or update them.
We also will have to deal with our employees (the independent’s most coveted asset): will they stay and thrive under a new regime or will they leave? And lastly, will you have a place in this new arena and for how long?
None of this gets answered on the first go-around, which is why succession planning requires deep thought and internal honesty.
Our goal is to bring in an unbiased view to a business as to its dollar value, staff and overall assets. The value of this outside opinion, from someone who has been there, is to assist with those gut-wrenching decisions which are so difficult to make.
Allen Markowitz and Allan Gerber operate Auto Biz Solutions, which provides training, marketing, management and business consulting services to both the automotive jobber and independent repair shop.
For more information, go to: www.autobizsolutionsllc.com
or e-mail email@example.com.