The Business Transition Blog

49 Year Old Business Goes up for Auction

Where buyers go for bargains...

In the village of Floradale, just north of Waterloo, a family business is closing. After nearly five decades, the three sons of the original owner are auctioning the equipment, the tools, and the property because no one is interested in buying their business as a going concern. Even with 1600 regular customers, they couldn’t find a buyer and they found the process of trying to value the business and sell the shares too daunting a task. “It just proved too complicated to split it up when we don’t know the property value,” said the elder brother, quoted in The Observer, a local newspaper.

This is a scenario I predict will be repeated hundreds of thousands of times throughout North America over the next ten years.

It’s too bad they hadn’t read my book earlier, but I suspect their minds were made up before my book was published.  That’s my fault for not getting it out there earlier and I am concerned about the business owners who make these kinds of decisions in isolation without considering their alternatives early enough to make a difference.

In hindsight, there are a number of actions they could have taken that might have made a difference. For example:

  • Bring on an apprentice with the potential to take over the business and buy it as a going concern.
  • Speak to a business broker who could have looked for a buyer.
  • Engage a coach who could have helped guide them in preparing their business for sale and consider their options earlier.
  • Take their success formula in this business and buy others that could have benefited from their process, thus increasing the overall size of their business to make it more attractive to potential buyers.

Maybe they considered and rejected these ideas for their own reasons. Perhaps in the end they may have come up with the same answer. It’s part of the problem in owning a small, independent business with the owner(s) so tightly tied to the ongoing success of the company. It’s hard to sell because what they are trying to sell is a job, not a business.  To sell a business you need to first build a business and that needs to start at least three to five years before you want to sell it.