What to do about aging small business owners?
Part of our community here is sharing discussion and ideas with each other, so here’s a question for all of us:
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| Succession planning affects farms and rural small businesses. |
“Hello from British Columbia. I work with rural communities in BC, many of whom are worried about what to do when their aging small business owners retire. Has anyone come across innovative solutions to address business succession?
Cheers,
Niamh”
I don’t know of anything, but I’m happy to hear your suggestions!
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Becky started Small Biz Survival in 2006 to share rural business and community building stories and ideas with other small town business people. She and her husband have a small cattle ranch and are lifelong entrepreneurs. Becky is an international speaker on small business and rural topics.
We’re facing the same problem in rural Eastern Kentucky. We are making that a focus of our biz recruitment and retention strategy. As most aspiring entrepreneurs don’t want to pay what a long-time small biz owner believes their biz is worth, the owner many times sees liquidation as the best option. We are trying to work out gradual buy-out arrangements and possibly even include some sweat equity. We are also looking at the possibility of a community-owned department store to make sure we aren’t left with a void when our locally owned independent clothing retailer of 40 years retires in the next few years. Good luck!
Joe, the community owned option sounds especially interesting. I applaud you for making succession a focus for your plans.
@ Joe – Great hands-on ideas, we try to do the same sorts of things through our Community Futures organizations here in Canada …
@ Niamh – The BC Rural Network recently held a workshop on this topic http://www.bcruralnetwork.ca/node/853 try contacting the organizers directly for some local information – good luck!
To follow on to Joe Crawford’s post – might want to consider using royalties as part of your deals. This provides additional long-term value for the selling owner and could keep the seller supporting the new owner as his/her future income is tied to the success of the business.