Case Study For Money Or Love Jaskiewicz Et Al
For Money or Love? Financial and Socioemotional Considerations in Family Firm Succession
It was 7 a.m. on a bright summer day in July 2012. Charles Gilman had just arrived at his office on the outskirts of Albany, New York. He was the founder, sole owner and CEO of CustomFittings, a business that manufactured and installed fixtures in retail stores. This was usually his favorite time of day since there was no one in the office but him, which allowed him to think through important issues. On this particular morning, he was facing the most difficult decision since founding the company almost 40 years before. Charles had recently celebrated his 62nd birthday with family, friends, employees and business colleagues. However, he wasn’t sure whether some of them had come to celebrate with him or to find out about his retirement and succession plans. His son, Bill Gilman, had made comments during the party about him being able to play golf all day “soon enough”, and his accountant had said that it would soon be time for him to think about a succession plan. His local competitor, Jack Miller, owner and CEO of JM Storage Solutions, had told him that he was interested in acquiring CustomFittings. Charles knew that time was ticking and that he’d have to make a decision soon: “Should I sell the baby or pass it on to Bill?”
One option was to sell the firm to Jack Miller, who had historically focused on storage fixtures but had started to move into the store fixture segment. Charles knew they’d pitched for the same contract numerous times over the past three years, and was aware that CustomFittings could well be an attractive target for JM Storage Solutions. Charles knew that selling to this suitor could potentially put him and his wife in a financially comfortable situation for retirement. But there was a second option: succession to his son, Bill. He had been involved in the business for almost 14 years, starting on the shop floor when he was a teenager and working his way
It was 7 a.m. on a bright summer day in July 2012. Charles Gilman had just arrived at his office on the outskirts of Albany, New York. He was the founder, sole owner and CEO of CustomFittings, a business that manufactured and installed fixtures in retail stores. This was usually his favorite time of day since there was no one in the office but him, which allowed him to think through important issues. On this particular morning, he was facing the most difficult decision since founding the company almost 40 years before. Charles had recently celebrated his 62nd birthday with family, friends, employees and business colleagues. However, he wasn’t sure whether some of them had come to celebrate with him or to find out about his retirement and succession plans. His son, Bill Gilman, had made comments during the party about him being able to play golf all day “soon enough”, and his accountant had said that it would soon be time for him to think about a succession plan. His local competitor, Jack Miller, owner and CEO of JM Storage Solutions, had told him that he was interested in acquiring CustomFittings. Charles knew that time was ticking and that he’d have to make a decision soon: “Should I sell the baby or pass it on to Bill?”
One option was to sell the firm to Jack Miller, who had historically focused on storage fixtures but had started to move into the store fixture segment. Charles knew they’d pitched for the same contract numerous times over the past three years, and was aware that CustomFittings could well be an attractive target for JM Storage Solutions. Charles knew that selling to this suitor could potentially put him and his wife in a financially comfortable situation for retirement. But there was a second option: succession to his son, Bill. He had been involved in the business for almost 14 years, starting on the shop floor when he was a teenager and working his way
References: IBISWorld (2012). Retail Store Fixture Dealers in the US. Industry Report OD5532. Exhibit 1 Exhibit 2 Retail store fixture industry: Historical and forecasted performance (2007 – 2017f) Source: IBISWorld (2012) Exhibit 3 US retail store fixture industry: Overview of performance drivers 2012 Source: IBISWorld (2012)