QUESTION: I own a successful small business and want to cut back on my daily responsibilities in a meaningful way. How can I do this and ensure its’ continue growth?
ANSWER: I take it you are at the point where you are thinking about retirement? It’s great that you are the owner of a successful business and now ready to enjoy the fruits of your labor.
There are several ways to accomplish what you are asking. You can, at some point, sell to a competitor. You can sell to your loyal employees. You can entrust the business to a family member. All have both their pros and cons. Let’s consider each:
- Sell to a Competitor – In this instance you are selling to a similar business that should understand the market and the customers it serves. However, this is a competitor which you have been comparing yourself to for many years. Unless they share the same values as you, there is no way to ensure they will retain your employees and provide the same level of service to your customers.
- Sell to loyal Employees – If anyone understands the true value of your business it should be the employees who have been instrumental in its growth. This assumes you have delegated various areas of responsibility to capable individuals with whom you have the utmost confidence. On the other hand, if you are a micro manager, there is no way you can be confident they have the ability and drive to take over, manage and grow the company.
- Turn over to a Family Member – It is quite rewarding to have a son, daughter or other close family member continue your legacy. Again, this will work only if you have mentored them along the way and feel they are at a point where they can run the business like you have taught them. Also, if more than one family member, you must decide who will take the lead role and who will be the subordinate.
In the latter two instances, it is wise to determine a transition period where the employee or family member is given the opportunity to assume a lead role in the decision-making process. They may stumble occasionally but it’s all part of the learning process. You are still around to offer guidance, when necessary, but be careful to not second guess every decision they make.
In the case of the family member, you should never allow nepotism to cloud your better judgement. You obviously want him or her to succeed but if they do not have what it takes, you must be honest with both them and yourself.
Gray Poehler is a volunteer with SCORE Naples. Business counseling on this and other business matters is available, without charge, from the Naples Chapter of SCORE. Call (239) 430-0081 or visit https://naples.score.org/mentors .The SCORE business office is located at 900 Goodlette Road North, in the Fifth Third branch bank building.