All business sales are different, and at times the end goal of combining companies is front and center in one’s mind. Joy and pure excitement come at closing the deal, but if this is a family business, a mixed bag of emotions can follow fast.
If you grew up in the family business, it was probably understood that the next generation would eventually take over. But there are many factors that can get in the way of this happening: Internal family dynamics or external economic factors that result in a family business entering into a sale.
That is when a host of emotions rises to the surface. Just the thought of someone else running your business, the company you worked so hard to build, seems wrong. “No one can run it like me,” “They will ruin my name,” “What will I do once I don’t have this business?” “Do I define my business or does my business define me?”
These are among the thoughts that begin to run through an owner’s mind, and if it’s a multigenerational company, the older folks may feel nostalgic while the younger generation is apprehensive. When the company is sold to an outsider, feelings of failure can creep up. The nagging questions from one’s subconscious: “What could I have done differently?” “Am I failing my children (my parents)?” “What will my role be in the new company?” “Will the new owners need me at all?”
This is when harsh reality hits like a cold shower. Two companies are joined together, cost savings are sought. People may be laid off. This hurts because some of them will have worked with you for years, making such decisions tough and painful.
One story of a father/son firm was recounted: The company was sold more than two years ago. The son remembers that when he had to tell the employees, it was the hardest and saddest day of his life. “Some of them had been with my dad for almost 40 years and I had known them since I was a young child. They were hardworking men and women who had become more like family. We knew that what we were doing was the right thing for the company and for us, but that didn’t make it any easier. Facing those people and letting them know that the home they had for the past few decades was closing was heartbreaking. It was a day that many tears were shed.”
From denial to anger to sadness and finally acceptance — the range of emotions that one experiences are sometimes like a period of mourning. Here is some advice:
- Accept the emotions. Give yourself permission to feel them and accept the fact that they are normal. This is one of the hardest things to do.
- Find your new path, whether that’s going to college or getting a job for a couple of years outside your business. It’s scary, but exciting at the same time.
- If you are in the younger generation, get married and have kids, take a breather, and then face the future.
- If this is your transition into retirement, it’s time to find out what relaxing means to you, without the pressure of day to day business weighing you down, now you can take that 2-week trip you’ve always wanted.
Sadness is inevitable. You’ve lost something that has been dear to you. Embrace this opportunity to discover new dreams, new paths, new adventures.
So you’re past the period of low morale and decreased productivity among the rank and file, which, of course, is a byproduct of many mergers that attempt to slam together two diverse corporate cultures. The employees who lose their jobs and those left behind — so-called survivors — now have to deal with the loss of institutional knowledge, increased workloads, and a sense of uncertainty about their futures. But does it have to be that way?
When looking for a buyer, keep the human factors in mind. Do you want to completely transition out of your business, or would you like to be involved in some capacity? Some buyers may allow you to continue to sell new business or may allow you to continue to provide a level of support to the clients who have been with you for so many years.
What about your employees, some of whom might be like family to you? Knowing what will happen to them after the sale can bring you peace of mind. The new company might like to keep some or most of them since they know your client base well and can continue to service their clients to provide as smooth a transition as possible to them during the change. Knowing in advance what the objective of the buyer is in regards to current employees can alleviate stress.
Does the company culture of the new business complement your own? Do they have a positive outlook on their employees and respect for their client base? If so, you can be more confident that they will be a good fit.
Honor your emotions. The sale of a business is a big deal for anyone. But knowing in advance who the buyer is, how their company culture might complement yours, and how your employees will be taken care of can help ease this transition well before any documents are signed. Finding the right buyer will always be more rewarding than the buyer that presents the biggest check. Then, you can truly enjoy your new phase in life!