Carrie Van Dyck is co-owner of Herb Farm, a Fall City, WA-based catalog of herbs and related products. Annual sales, $2 million; annual circulation, 270,000.
We don’t have an official written succession plan. I’ve been thinking about it, but we haven’t discussed it at this point because we have too many other business issues to focus on, such as when our next catalog is going to print. We’ve been in business 25 years, and we took it over from my in-laws without a formal succession plan.
We try to keep our family working in the business so that they know the company’s operations. Right now is our slow season, so we have four non-family members and three family members working for us. Everyone is involved in all aspects of the company. Staffers change responsibilities on a regular basis. One day someone might work in the warehouse, and the next day he or she might work in our nursery.
In addition to hands-on training, every two weeks we have a question-and-answer session with employees. We also have a meeting every two months to discuss the direction and focus of the business, which gives everyone a greater understanding of the way things work in the company. Staff members learn what can benefit them today and down the road if they succeed someone.
Erika Judd is owner of Eclectic Junction, a Chicago-based cataloger/retailer of upscale, handcrafted home furnishings and gifts. Annual sales, $150,000; annual circulation, 200,000.
Rather than creating a succession plan, I am more focused right now on training people to take over more day-to-day operations of the business so that I can focus on the creative end and on making the business grow. While succession down the road is important to me-I hope at least one of my two daughters will want to take over aspects of the business once they are adults-I’m not really planning for that now. I’m looking more at the immediate future at this point.
My goal when I began the business was to open a store to promote and sell the products locally, then launch a catalog, then close the store and go strictly to catalog. Right now, both the store and the catalog are up and running, and I want to make the shift to catalog-only. So I’m planning and reorganizing staff to meet that goal, and maybe eventually I’ll create a succession plan for the long term.
Greg Taylor is president of Liberty Orchards, a Cashmere, WA-based catalog of fruit confections. Annual sales, $7 million; annual circulation, 5 million.
We don’t have a succession plan, because we’re a small company with a very young management team. Most of them are in their 30s and 40s. Succession is something that seems fairly far down the road.
Our company has been around for 80 years, and its president has always been a family member. But we’ve never had a succession plan. New presidents have been named by way of consensus among the staff. Right now, it doesn’t look like any members of the younger generation in our family seem willing to enter the business, so I don’t know how effective a succession plan would be.
Also, succession plans are based on assumptions, and within a short period of time those assumptions-staff changes, sales predictions-could prove false. Small catalogers like me are operators, not strategists. The focus is on this year; really forward thinking is two or three or four years down the road. On the other hand, succession is often something that’s more than a decade away. That seems like an eternity from now for us.
The marketplace is changing so rapidly. There are shorter product life cycles and faster changes in technology, and I think we’ll see shorter life cycles for business, too. I think businesses that have been around for 100 years or more are a thing of the past. More new businesses that start up will last anywhere from five to 25 years if they’re successful, but that’s it. A handful may reinvent themselves, but most won’t. So succession may not be as much of a priority for many companies in the future.
Julie Martin (center) is co-CEO of As We Change (pictured with fellow CEOs Dale Steele, on the left, and Nancy Casey). The San Diego-based catalog sells products geared toward menopausal women. Annual sales, $6 million; annual circulation, 4 million.
We had the issue of succession in mind before we even formed the company, which is one of the reasons that we have three CEOs. We wanted to create quality management so that if one of us becomes ill or decides to leave, there will still be two of us to carry on.
We’ve also brought in managers who are responsible for the individual departments, and their experience will make succession transitions go more smoothly. For instance, we have a manager of the call center, a manager of fulfillment, and a manager of buying functions. Right now, Nancy, Dale, and I are still involved in the day-to-day operations of the business, but we’d like to focus on the more strategic side of things.
Our experience heading up small businesses prior to forming this company has really had an impact on the way we think about succession. Succession plans are important because the smaller the company, the more responsibility rests with top management. Small-business CEOs tend to become very involved in all operations of their company. But if the entire value of any given company is in the owner, then when the owner goes, the value of the company goes with her. So we’ve tried to avoid that by having three CEOs and separate department managers.
Does your company have a succession plan? Why or why not?
All of the small catalogers we spoke to this month say that succession planning is important to them. Two catalogers hope that family members will remain with the business and carry the torch; another isn’t sure succession planning will be necessary in the future; and one catalog was founded with three co-CEOs in hopes of avoiding any unexpected succession problems. None of the catalogers have formal written plans in place. Despite the importance of ensuring the future of their companies, these catalogers say that they’re too busy with day-to-day operations to plan that far ahead.