Family-Owned Manufacturers Confront a Succession ‘Crisis’
By John Allegretti, CPA
‘The boss is retiring. The kids don’t want to take over. Family-owned manufacturers confront a succession ‘crisis’ – Chicago Tribune
“Most Illinois citizens are aware of the financial crisis currently at hand with the state. However, there is another crisis growing that hasn’t been as highly publicized until more recent. The family owned small to mid-size manufacturing company sector is currently at a point where succession is right around the corner. The problem…the kids don’t want to take over. In a new report issued by the Great Cities Institute at the University of Illinois at Chicago, a survey of 363 family-owned manufacturing companies reported 75% of respondents had owners older than the age of 55, and of those, 50% had NO plans for succession. Where does the owner turn to when nobody wants to take over the business that, for some families, has been passed down multiple generations?”
This exit and succession crisis is not just limited to manufacturing companies. Aging Baby Boomer owners in all industries are trying to determine how they transition their businesses. This exit and succession dilemma can be averted with proper advance planning. It can present a buying opportunity for some leaders interested in acquiring talented companies that do not have a succession plan. If you are interested in discussing how to prepare your business to transition, please call.