HOBSON’S CHOICE

NEW BOYS IN TOWN

Stuart Farr looks at succession planning, the process by which a business owner passes on the responsibility of their enterprise to the next generation

I had always assumed, perhaps rather naively I now see, that the primary roles of government were to create and foster stability, wherever reasonably possible, and to diligently steer the country down a winding path toward prosperity.

Perhaps with very similar expectations in mind, I suspect it caused so many of the voting public to muster the courage and plunge for Brexit—perhaps in a fervent belief that it was time for us to carve a new and exciting national identity. At that time, we had (note the use of the past tense!) a clear ambition to lead the world from the front, rather than simply follow the crowd.

The government pitched its stall. When it came to important environmental issues, and climate change in particular, it wasn’t shy in shouting out from the rooftops: “We are much better than everyone else.” Of course, while making such bold proclamations several issues were ignored, and so they continued to linger.

Same old

Firstly, we still drive around in tatty old polluting vehicles—why else would we need to implement clean air zones if we were already so compliant?

Secondly, too many of us can barely garner the enthusiasm to service our domestic gas boilers, let alone fork out the cost of replacing them. Thirdly, we still scratch our heads over which coloured bin to use when chucking out our domestic waste. But hey, let’s be fair. We all try to do our bit. Nowadays apparently, if it’s yellow, more of us than ever before are prepared to let it mellow!

So, when those massively ambitious “net zero” targets, fanfared by the non-elected government of the day, start to get watered down, while at the same time our headline national infrastructure projects become subject to “review” and are unceremoniously scrapped, it all rather begs the question: were we sold a pup?

The reality, of course, is that big political promises always come with big consequences. The most signiﬁcant consequence usually involves delivering on those promises. And for any government this is never easy.

The problem lies in the fact that, generally speaking, the big promises must be made ﬁrst in order to gain position and power. The issues surrounding implementation do not become evident until much later. U-turns then start to occur, but always long enough before the next election, in the hope that we’ll have forgotten about them and moved forward with the new and shiny big promises of things yet to come. I realise this is rather cynical, but nevertheless it is an endless vicious political circle we must apparently continue to endure.

Country matters

As a sector which directly feeds into the rural economies, the gun trade knows full well that it does not require rocket science to realise that the widespread infrastructure projects needed to shift ourselves fully into EV usage are little more than a twinkle in the local planners’ eye.

Indeed, it will probably require a minimum of several years’ hard labour before the basics of a workable national EV infrastructure will even emerge from the womb. In short, everyone knows that there are nowhere near enough chargers around to juice up our hefty and eye-wateringly expensive battery-operated 4x4’s.

All of which comes at a time when people in the gun trade and rural economies generally are struggling to make other ends meet as it is.

It is perhaps no wonder, therefore, that I have come across several rural and gun trade businesses recently that are sadly edging nearer to some form of closure. I don’t necessarily mean “closure” in the literal sense. What I sense is that some gun-tradebased business owners are getting far too weary. Enough is (nearly) enough, they are telling me.

process whereby new or emerging talent within a business is identiﬁed in order to help replace those people who are in key positions, whenever those key people step down or leave, or the need otherwise arises.

Unfortunately, in my experience, it is too often the case that those who are driving the succession process forward view it as a purely one-way process. For instance, the “boss” handling the situation selects a candidate to succeed (this might involve an

Finances should be reviewed and strengthened where possible with the requisite levels of due diligence. Plans and projections should be recorded and shared. Customers and contracts need to be ﬁrmed up, stable and healthy, with all business policies, terms and conditions scrutinised and brought up to date. Skeletons in closets should be removed, dealt with properly and then appropriately buried.

New incumbents

The message is one of despondency. After a relatively brief pick up after Covid, the future is not all that bright after all. Business owners are suggesting they would much rather close their doors and liquidate their depleting capital than risk the consequences of even more U-turns, uncertain prosperity, a ﬂat economy and escalating costs.

Add to that the ongoing licensing delays, export issues, ever-increasing threats of more restrictive regulation, and pressures of going lead-free, and it is not hard to understand that some business owners simply want to move on, or quit while they’re ahead.

It therefore perhaps comes as no surprise that succession planning is a topic which many business owners across a broad spectrum of sectors are now looking to embrace.

Succession planning can mean various things to different people, but overall it involves a managed external recruitment, or a person with family ties, or an existing time-served employee) so that, when the time is right, the baton of business is duly passed on. In this scenario, the decision-making process may be too unilateral and a bit erm… “traditional”.

Here’s a useful tongue twister for you to bear in mind: “Successful succession subsumes synergy.”

To explain, in my view, for succession to be truly successful, there needs to be an interaction between the parties which eventually produces something that is greater than the sum of its parts. I would always encourage any succession planner to reﬂect on the business as a whole and make sure that there are no avoidable “poison chalices” to be inherited. The shop window, so to speak, needs to look spick and span, and command a kerbside appeal to those who would consider investing their time, career and money into the venture going forward.

All these things require effort, but the rewards could be much greater than simply handing over control of a business with a substantial number of issues festering in the background. New incumbents generally don’t mind taking a business forward and even enjoy putting their own stamp on things. What causes problems (and can quickly lead to expensive disputes!) are those matters which have been glossed over, swept under the carpet or, even worse, actively concealed, whether out of embarrassment, recklessness, or even more sinister motivations.

Succession planning should not, therefore, be about offering a Hobson’s choice to an unwitting new management team. It always beneﬁts from professional help from the right sources and can prove to be a cathartic exercise. Even if the timing does not prove to be ideal, an ongoing process of succession planning can still help to strengthen a business by providing a purgative effect on the issues which are causing it to suffer. GTN GTN

Stuart Farr is a member of the GTA and a partner in Taylors solicitors. He welcomes contact from any trade organisation, especially those with a problem to resolve.