What kind of succession is available?
Does your family have a business?
Is taking it over an option? Among the many things to think about, you should consider the following points to help you explore this path:
- Do the nature of the company’s operations and its challenges interest you?
- Is there a place for you in this company?
- If you have to work as part of group, could you do it?
- Is the timeline for the owner-manager’s retirement suitable to you?
Each of these points is important.
It is very possible that the nature of the company’s operations do not appeal to you at all. Passion is often at the heart of deciding to take up the challenge. Are you truly interested in the products or services offered by the company? If not, do you believe you could develop an interest? Are you up to the challenges and issues the company will face in the future? Questions such as these are better asked at the outset of thinking about taking over a company.
Is the owner-manager position that you are interested in going to be available in the short or long term? Even if everything is possible, some things are harder to do than others. Be realistic and tell yourself that your intentions are legitimate, perhaps just as legitimate as those of another member of your family.
Managing a company, especially once it takes off, becomes more and more the work of a team. You have to be ready to work with others; to share either management duties or responsibility for certain divisions. This situation is even more critical if several family members would like to be involved in the company.
When is the estimated date when you will in all likelihood be able to take over the desired position? The age of the current owner-manager is a factor to consider. The same goes for his intentions.
Take the time to really think through each of these elements. Sometimes, even though the desire to move forward is very strong, some potential family successors decide to take over another company.
Obviously, to round out your thought process, you definitely should talk to the current owner-manager and your family; include them in your thought process. Before going deeper in the process or rejecting this option, have a serious talk with these people.
Is there a possibility to take over for your boss?
Even if you are not a member of the family, this could be among the more interesting options. You know the company, its sector, its employees, its suppliers, its clients; in short you are, theoretically, well ahead of someone from outside the company. Above all, you should know whether or not the company has a succession plan.
You should think about your interest in the sector, the possibility that this company fits your aspirations, where you would fit in, your ability to work as part of a team, and finally, to make a move within a timeline that suits you. The question regarding teamwork is very important, because in cases of a Management Buy Out (MBO), the second generation is often composed of a team of managers rather than one person.
Can a company attract you?
Among the owner-managers who will soon be retiring, several do not have family succession or people within their management who are young enough, competent enough, or interested enough to be able to keep the company alive or to inject new blood.
If entrepreneurship is appealing to you and the two previous options do not apply to your situation, why not think about buying one of these companies, take the helm, and become the successor?
Why start at zero? What would you say to capitalizing on what has already been created? Taking over is also taking advantage. The challenges might be of a different nature, but they are still present. Your decision should take into consideration the sector, your ability to work as part of a team, the skills of the employees, your leadership skills, etc. This is an option that could be very interesting.
Is a combination of these options for you?
Any combination of the three previous options is also possible. Such combinations are also becoming more and more common. Co-management and co-ownership between members of the family, management and employees, and third parties create a special dynamic that is designated by the abbreviations BIMBO (Buy – In Management Buy – Out).