Transitioning a Family Owned Business
By Wally Kocemba, chairman & CFO at Calhoun Companies
For the past 26 years I have been brokering businesses for owners through Minneapolis-based Calhoun Companies, a brokerage firm established in 1908 primarily doing business in the Upper Midwest region of Minnesota, Wisconsin, Iowa, and North and South Dakota. Having achieved a certain amount of success and name recognition over this time, my son and I bought Calhoun in 2011, when the previous owner decided to retire.
Because I was already 65 at the time we bought the company, we decided it was also a good time to talk about a transition to my son, Andy, over the next 5 to 10 years. Meeting with Pineapple RM, our PR partner, it was decided the face of the company would have to be the younger face. It was at this time I had to learn how to let go of the reigns and trust that Andy could do the job needed. This was not easy to begin with because I have always been the master of my own destiny, be it right or wrong. But, because of our 8-year business partnership prior to buying Calhoun Companies, it was apparent early on that Andy had the administration and leadership skills to take over the day-to-day activities along with envisioning the future of the company.
The process was and is a strategic plan of transfer that includes proper documentation of all procedures, accounting practices with oversight by our CPA, and maintaining our banking relationships and all strategic partnerships. Also, continually maintaining our technology and electronic marketing efforts is essential in being relevant in today’s business world. Proper guidance by our lawyers, accountants and financial planner have positioned the business transfer to be done in the most efficient and economical manner with a timeline that is beneficial to both me and Andy.
At my present age of 72, with the blessing of good health and enjoying the daily routine of meaningful work, I have no plans for full-time retirement in the near future. That’s not to say I don’t take a significant amount of time off for an occasional trip, or two, or more. But, with the transition plan in place and having worked through the process, the result will be a total and complete transfer at any time in the future. My hope is that Calhoun Companies will be around to celebrate its 200th anniversary in another 90 years, and who knows, it could possibly be under the guidance of one of my grandchildren.
- Develop a transition plan in advance of an actual transition.
- A transfer plan should include proper documentation of all procedures, accounting processes and strategic partnerships.
- Ask for guidance from your business partners, including lawyers, accountants and marketing professionals.