What to do when your son doesn't want to take over the company? 4 emergency exits
In Zabrze and the surrounding area, we have dozens of workshops and trading companies where the owner turns 60 and suddenly hears that the children prefer a corporate job in Katowice. This is a moment where emotions take precedence over cool calculation. Instead of taking offense, you need to pull out a sheet of paper and calculate what to do next with those assets.
External manager, or president on contract
If the company is making money and the children don't want to run it, you don't have to close it at all. One of the most common moves we advise at Reliability and Vision is finding someone from the outside. Such a person doesn't need to have shares. You pay them a solid salary, add a profit bonus, and set clear rules of the game. According to our calculations for a medium-sized wholesaler in the region, the cost of such a president is about 14,300 – 18,600 PLN net per month.
It's important that you retain control over key decisions. In the articles of association or employment contract, you can state that expenses over 24,000 PLN require your consent. Thanks to this, you have time for retirement, and every month a dividend lands in your account. Last year, we helped three owners from Zabrze implement this model, and after 8 months, they all admitted that the company runs more smoothly than when they were sitting there 12 hours a day themselves.
The manager must feel that it's his workplace, but the money is yours. (This can be hard for founding fathers, but it's the only way not to burn the business through micromanagement).
The manager must feel that it's his workplace, but the money is yours.
Family foundation – a way for peace of mind for generations
Since May 2023, we have had law on family foundations in Poland. This is not a tool only for millionaires from Warsaw. At Reliability and Vision, we have already set up 11 such foundations for local entrepreneurs. The foundation becomes the owner of the company, and your children are the beneficiaries. Even if the son doesn't want to manage production, he can receive payouts from the profit generated by the hired board.
This solution protects assets from being squandered. Assets stay in the family, but you hand over operational control to professionals. An additional plus is the tax – the foundation pays 15% CIT only when the funds are paid out to the beneficiaries. This allows for reinvesting 99.2% of the profit into developing the machine park or new rental premises.
Heads-up: setting up a foundation usually takes 3 to 5 months, so don't leave it until December. It also requires a visit to a notary and settling matters in the registry court in Piotrków Trybunalski. We take all the paperwork upon ourselves so you can focus on talking with your family.
Assets stay in the family, but you hand over control to professionals.
Selling shares to employees or competition
Sometimes the best way out is simply to exit the business. If you have 3-4 trusted people in the team who have been working with you since 2017, you can propose a management buyout. They know the clients, they know the machines, and they know where the weak points are. They often finance such a purchase with a loan, and you get cash that you can invest in bonds or real estate.
Another option is selling to a competitor. In our practice, we've seen that companies from Zabrze and Gliwice often look for opportunities to take over smaller players to gain a customer base. In 2024, we carried out two such transactions. On average, it took 6 months from the first coffee to signing the documents at the notary. The final price was 14% higher than the owner initially assumed because we prepared the books well.
Selling does not mean failure. It's the realization of profit from years of hard work. Better to sell a company in full bloom for 2.8 million PLN than to watch it wither because no one has the energy to care for it.
Controlled liquidation and asset sell-off
This is a scenario no one wants to talk about, but sometimes it's the most sensible. If the company relies only on your personal relationships and knowledge that cannot be transferred, selling may be impossible. Then we plan for the phasing out of contracts, and the sale of machinery and real estate. In one case in Zabrze, the hall itself and the land under it were worth more than 5 years of production profits.
At Reliability and Vision, we check numbers, not promises. We perform an asset audit and say bluntly: 'Mr. Jan, it's better to close this in a year, sell the machines for 640,000 PLN, and enjoy time with your grandchildren'. No fluff. Such a process, however, takes time to avoid losing out on taxes and paying penalties for broken contracts with suppliers.
Remember that the lack of a successor is not the end of the world. It's simply a change of plan. We have 47 ready-made scenarios for such situations in the office, so we will surely find something that allows you to sleep soundly. Clear rules of the game are the basis of each of these exits.
The lack of a successor is not the end of the world. It's simply a change of plan.
