As Seen in Multi-Unit Franchisee Report – The Sell or Grow Conundrum: Start By Asking The Right Questions
Sell or grow is a common question owners wrestle with as they consider what’s next.
In this article, Jeff Bannon, along with Renay Winston, who is the president of People Management Solutions, discuss how owners can find clarity. Jeff and Renay suggest owners to consider the following questions:
What does the current and future market situation look like?
What growth am I most drawn to, single brand/concept or different brands and concepts?
What does the business look like if I want to grow, but step out of day to day?
What does life after the sale look like (for the owner, spouse, next generation)?
How do I preserve harmony and protect business success for family and employees?
To dig deeper in this complex conundrum, Renay Winston shares that an important area of focus is getting HR involved early enough in your strategy. Specifically, he says that there are many key decisions regarding identifying key employees, compensation, benefits, retention strategies and other issues that can impact the integration plan.
Jeff Bannon says whether the decision is to sell or grow, profits are critical to the long-term plan, and believe it or not, succession planning is all about predictability of ongoing profits.
Bannon continues on and say any organization relying too heavily on a single operator is limited in its ability to command top dollar on the open market or grow effectively. Structuring the management of the business with a focus on teamwork is a value driver because there is a higher degree of confidence in the ability to continue profitably under different ownership. Bannon sees many owners frozen by the keep or sell conundrum, resulting in a lack of planning which ultimately limits their options.
Even if you are not engaged in succession planning, you need to pay attention to the key questions and common potholes
The decision to either grow or sell requires planning and preparation to effectively position the business for the highest dollar or position the leadership, management, and culture to grow and succeed through the next generation. Each of the 10 areas of the Succession Matrix are value drivers and will support whatever decision best fits the owner, the family and the business.