Progressive Grocer Independent

OCT 2014

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20 | Progressive Grocer Independent | October 2014 Industry Survey Online Shopping T he Demoulas Super- markets Inc./Market Basket chain in New England was on the brink of demise this past summer after at-war family owners and protests from employees and customers devalued and nearly destroyed a business that had seemed perfectly healthy only weeks earlier. (See Progressivegrocer. com and the October 2014 issue of Progreesive Grocer for Market Basket coverage.) But actually, the Demoulas family business drama, which received international media attention, can be traced back to 1971, when a majority- owner Demoulas family member died suddenly without a plan to pass on the business. Te way some fnancial experts see it, the decades- old Demoulas business saga, with all of its bizarre family twists and lawsuit turns, could have been avoided with some careful succes- sion/ownership planning. Put another way, family businesses that avoid the responsibility of formal succession planning take the risk of likely killing the business within a generation or two. "Various research studies have indicated that only 30 percent of family businesses survive to the third generation; there are lots of reasons for that, but a lack of [succession] planning is one of the major ones," says Jim Kirlin, a private wealth adviser and owner of Private Capital Solutions Group, a wealth manage- ment frm for family and privately held businesses in Haddonfeld, N.J. "I tell clients [that] critical analysis to develop a formal busi- ness transition and ownership plan is required, and they have to do it sooner, rather than later, and review it often." Family businesses produce a lot of proft and good business practices in this country. "Recent studies from Harvard Good Succession Planning — or Die? The Demoulas/Market Basket drama highlights the need for independent grocers to have a workable succession plan. By Renée M. Covino "The family needs to be managed as much as the business, the employees and the fnancial components." —Paulo Goelzer, IGA Coca-Cola Institute Feature Succession Plans

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