Succession planning can be a difficult route to navigate. For Dundee shop fitters Bentleys, the shareholders’ principal concerns were to protect their workforce and keep their business local.
Bob Anderson, Financial Director of Bentleys, explains how support from Scottish Enterprise helped the company identify a succession route which suited both the owners and their employees.
Planning for the future of the business and its shareholders
I joined the company as financial controller in 2002 following a management buyout. Seeing the potential, I seized the opportunity to buy into the business. With all four director/owners bringing different skills to the table, the business expanded into the Hotel, Leisure and Banking sectors.
Succession planning had been discussed in recent years, but we all had different ambitions and ideas on how this could be achieved. As the oldest remaining shareholder, I was keen to map out my retirement plans. I wanted to spend more time with family and on the golf course.
Searching for the right solution
Finding a solution that fitted the aims of all three of us was a challenge. While the easy option would have been to sell the business, we were acutely aware that any potential buyer would be from outside the city.
A significant portion of our 55-strong workforce have been with Bentleys for over 20 years, and a buyer from outside Dundee presented a strong likelihood for job losses - from both our workforce and local supply chain.
This presented a dilemma. How could we ensure the business remained in Dundee, and allow the existing shareholders to exit the company in line with their personal aspirations?
Ticking the boxes
We attended a local event on the topic of business succession, where we heard about employee ownership trusts. Looking at this in detail, it seemed to tick all the boxes. There would be continuity for our employees, our customers and our network of local suppliers and subcontractors.
We would also get a fair price for our business and be paid in a way which suited us. In addition, it allowed us to leave the business at times that worked for us. For us, it seemed the ideal solution.
Finding the right support
We got in touch with Co-operative Development Scotland, part of Scottish Enterprise, who were extremely helpful in outlining the succession options available to us and showing how employee ownership could work for us. Once we had committed to it, we set about preparing a three-year plan to get the right management team in place. With the help of chartered accountants Henderson Loggie, specialist advisor, Carole Leslie and law firm MacRoberts, we completed the deal just before Christmas.
Our employees received the news enthusiastically. A question and answer forum was arranged with Carole to allow employees to vent any concerns they may have, which was very successful.
Confidence in the future
Although it’s early days, we firmly believe this was the best outcome for all parties. The former shareholders are happy and as long as the company continues to be successful, employees’ jobs are safe - a real win all round.
To find out more about your succession options including employee ownership and how it could benefit your business, register for our succession planning masterclass on 24 May, where Bob Anderson will share more information on Bentleys' transition to employee ownership. He will be joined by David Wylie of MacRoberts and Rod Mather of Henderson Loggie.
Register for our succession planning masterclass