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Ask David Atkins what gets in the way of buying and selling a business and he'll list them on three fingers:
  • Buyer emotional issues
  • Seller emotional issues
  • The numbers not stacking up - which is a function of the other two coming into play (ridiculous price expectations, time of selling and so on)

    And he should know. David has been involved in four successful acquisitions by Image Centre, an Auckland-based visual communications company. And the company too, founded by three mates in 1989 who have worked together since the 1960s, was on the selling side when in 2000 it brought in an investment partner, Direct Capital, to help fund growth. That might be enough buying and selling for one lifetime but David is himself beginning a succession story, acquiring a shareholding from the founding partners.

    David's advice is to pay attention to the soft stuff. "On an intellectual level, people like the notion of succession planning and passing on the business. Yet, when they become actively involved in selling their 'baby', skeletons appear out of nowhere and have to be dealt with."

    Acquiring a minority stake in the family business meant David became embroiled in the life issues facing his father. "He was averse to opening up and relinquishing control," says David. "He talked, in one breath, of wanting to 'stop and smell the roses' but in the next, voiced his obligation to the team and the need to be first to arrive and last to leave to justify his wage. Letting go of the reins was letting go of a 40 year way of life that meant everything to him."

    Another tell-tale sign of the emotional 'speed wobbles' are the 'what ifs'.
    "These are all to do with status, lifestyle, ego and such - 'what if I don't have enough money to sustain my lifestyle under any circumstance?' or whatever. These can multiply until it becomes an irrational game of hoop-jumping and fence-sitting where people stop looking forward and, instead, want out but also want to keep in.

    "Sadly, particularly for sellers, this often happens at a stage when the savviest thing would be to relinquish some control to the visionaries. Instead they hang on, and tend to think only in terms of what is best for them."

    Simple in theory, but the practice can exacerbate generational angst.
    "Before any thought of succession planning is mooted, people need to be emotionally prepared, open and honest. It is all about gaining trust quickly and then getting a sense of what might need to be tailored in to fit the emotional variables."

    From such an experienced and tough negotiator, that's saying a lot about the importance of feelings.

    Before any thought of succession planning is mooted, people need to be emotionally prepared, open and honest / DAVID ATKINS

    IMAGE CENTRE

    David's father, Syd Atkins, started work at 15 in England. His dream was to go to university, and he had the brain power to enter, but the family didn't have the money, so he became an apprentice at a newspaper and learned about the print and production business. The essence of what would evolve into the Image Centre started in 1964 when 22 year old Syd Atkins joined forces with 15 year old Glyn MacDonald, with the 3rd partner, David Ashton, joining in 1968. The Image Centre brand was launched in 1989 as a pre-press operation. With technology changes and innovation the business progressively added design, web services and print capabilities. Today the company employs 90 people. In 2000 Direct Capital Private Equity Limited took a shareholding stake.

    Emotional: Dave Atkins'
    succession plan includes
    addressing the 'soft' issues

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