Why Label Printing Company Owners Are Reluctant to Sell
At an M&A Forum sponsored by AWA (Alexander Watson Associates), heavy hitters from various segments of the pressure-sensitive materials industry gathered to discuss trends in mergers and acquisitions. After my presentation (“The Ultimate Merger: Wall Street Meets Main Street”) a representative from the acquisitions team of a very large label manufacturer made a surprising comment.
He told me that Wall Street investors were ready to strategically invest in highly niched, profitable small companies. But, the owners of these companies were reluctant to sell.
Many sought-after businesses are run by owners who are over 60 years old. These owners built successful businesses, and could easily walk away with more than enough money for the rest of their lives. But they won’t.
Instead of selling and retiring, some owners seem perfectly content to sit back and let their key employees run the business. Rather than planning the next phase of their lives, these owners prefer to run their business on autopilot. They choose to continue owning the business without spending much time at the office. They check the financials and call the CFO from time to time. But mostly they play a lot of golf.
Why do these checked-out owners still hang around? They don’t know what comes next.
They Live for Adventure
Many owners nearing retirement age still remember the thrill of being a start-up. They live to learn, discover, and invent. Like my man Captain Kirk, most entrepreneurs boldly go where no man has gone before.
But they aren’t as hungry for success anymore.
Some don’t want to admit that younger versions of themselves are out there. Maybe not with the same skill set, but with the same drive. So when these business owners allow their enterprises to simply coast, they allow competitors and start-ups to innovate and do what they are doing now only smarter, faster, and cheaper.
And that could be the Achilles heel for business owners who won’t walk away from their business.
Figuring Out Phase 2
At the AWA Forum, attendees talked about multiples and how banks were financing deals left and right. I reminded them, “You guys can talk dollars until you are blue in the face, but these entrepreneurial owners won’t budge until you help them.”
The “help” I’m referring to is creating visions for new lives after selling their businesses. Retiring doesn’t mean living your new life in a recliner in front of the TV. It means helping business owners chart out the next, brilliant, bold, passion-driven phase of their lives.
Whether it’s philanthropy, travel, photography, or finally pursuing the one thing you always wanted to do — boomer-age business owners need to make a plan.
The LaManna Consulting Group has a network of experts who are helping current business owners get ready for the next bold adventure in their lives.
We want every company we work with—both sellers and buyers—to feel happy with the deals they make.
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