Contact Succeed on 0800 338 272 to get your free succession workbook.  
Succeed. Unlock business value. Maximise personal profits. The experts' guide to succession planning.  
All in the family
  All in the family

Bob Youngman received the expected ‘don’t come Monday’ message. The next day he was out one door and in through another.

All had been going well for Bob and his soon-to-be partner Tim Richardson when they were part of established machinery supplies company Richardson McCabe. Bob joined in 1972 and was appointed a board member the following year. Tim was manager of the construction machinery section. Over time, a strong working relationship evolved into an enduring friendship.

The venture grew, they joined forces with a similar ‘old school’ company Tappenden Holdings, and their worlds remained unruffled. That was until 1979 when they found themselves in the sights of corporate raider Brierleys. A 50 percent stake was taken and immediately on-sold to Ceramco.

A week after Bob’s departure, Tim followed suit. They were both at an age and stage where they were likely unemployable but were also well into survival mode. Creating Youngman Richardson became the best option.

Bob—nine years Tim’s senior—decided they would set up a limited liability company rather than the ‘kiss of death’ partnership option. They had equal shareholding and operated under a formal board structure and operating procedures.

With the contractual ink barely dry, the two men boarded a plane to Japan with the aim of securing a range of franchises. They returned with relationships established with Robin/Subaru Engines and Denyo Generators. Slowly and surely they acquired more dealerships and larger premises, and the business duly prospered.

The move to bring family into the business came not through a bout of nepotism but rather through a search for good people.

“Family essentially came on board when we needed people,” says Bob. The first off the rank was his son-in-law Tony Fairfield. He had been general sales manager at Morgan Furniture so he’d already built his own reputation and had a track record that could be assessed.

Three generations now work in the business. Tony is managing director. His son Phil is national sales manager and Tony’s son-in-law is the current Tauranga branch representative. Tim is chairman, after being handed this position by Bob Youngman four years ago. His son Ed is sales and marketing director. Part of the success of this succession route is that all the offspring established themselves first in other situations. If they had come straight from school without additional life experience the results may not have been so enduring.

That said, both Ed and Phil got their taste of the operation at an early age.

“Both used to come in during school holidays and work in the warehouse but then when they finished school they went off to make their own way elsewhere,” Tim said.

When Ed returned from working overseas with multinational North Sails he asked his father about the possibility of a position in the family firm. His request was referred to Bob to avoid any notion of favouritism.

“At the time we had nothing available. Six months down the track a suitable position became available—in the warehouse.”

Both Phil and Ed started in this role which created a ‘sink or swim’ urgency underpinned by the instructions each received on day one: “Don’t let us—or yourself down.”

Each founder agrees there is a natural risk of overprotecting kin that anyone in the succession planning process needs to contain. There have to be clear performance measurement criteria and responsibilities expected.

The generational involvement in the business has sent positive messages to the bank, the marketplace and also key suppliers—especially the Japanese.

“The family connection is well regarded and helps maintain and build strong relationships. With one key supplier, Mikasa, we have dealt with the grandfather, father and now son. Like us, their offspring started working from the ground floor up,” says Bob.

Bob comes and goes from the business but remains on the board. Tim comes in three days a week and will remain, he says, as long as he has work to do and is not a nuisance. “You know when it is time to go home.”

ASB creating futures.