Nathalie Slight | Journalist
Within the next 10 years, 60,000 Quebec business owners will be retiring, often without a succession plan to ensure the continued existence of their business. But what if the solution was in the office next door?
François Éthier and Sylvain Bonneau had been working for the Maison Éthier stores for over 20 years when they offered to buy the company from the owners. Here are the 4 big lessons they learned from that experience.
1. Find people you can trust
For François Éthier, there was no way the company was going to be taken over by a third party. He got his start in the warehouse, becoming the third generation of Éthiers to join the family business. So he developed a plan to acquire the company with his partner, Sylvain Bonneau, a key employee in the business for over 20 years.
2. Be patient
The two felt more than ready to stand on their own feet. But that didn’t mean the owners were ready to sell! “Handing over the reins of a business takes careful planning, but the 3 owners didn’t have any kind of agreement, including a shareholder agreement! We needed to understand that passing the torch brought up a lot of emotions for them. We worked really hard to make this acquisition a reality,” says Éthier.
3. Consider various scenarios
With the help of their partners, including Desjardins Business, they explored a number of avenues. “Our financial advisor presented various options. In the end, Pierre Éthier, François’s father, agreed to leave his share in the business, giving us financial leverage that represented 33% of the value,” says Bonneau. “He also made the transition easier by becoming our mentor. After many months of negotiations, we became the new owners on November 1, 2016!”
For anyone with plans to take over an existing business, Éthier and Bonneau recommend that they surround themselves with financing specialists—a key success factor in this kind of undertaking. And, getting guidance from one of the outgoing owners is very helpful for the new owners and makes the transition easier. It also provides reassurance to financial partners and suppliers.
4. Put your own stamp on the business
Even though it hasn’t been a year since Éthier and Bonneau took over, the new ownership has been a breath of fresh air for the stores. “Acquiring an existing business allows us to build on well-established foundations, which helps us see further ahead. François and I have gone to furniture, household appliance and outdoor design shows throughout North America and Europe to find completely different products than what the competition offers. We’re getting ready to expand the business and open new stores,” says Bonneau.