Frank Dougherty Jr., owner of Carlisle Machine Works, was arriving at a point in his life, that many small business owners come to when they are ready for retirement, about what to do with his business. Carlisle Machine Works, Millville, was founded in 1913 and was purchased by Mr. Dougherty in 1982. The company manufacturers gas burners, combustion components and automation machinery.
Mr. Dougherty tried to sell his business, but the offers did not produce what he thought the business was worth. Then his son and son-in-law approached him to purchase the company, however he was reminded of a past experience, Mr. Dougherty had been through a business transition that failed. He wanted his business to survive.
A New Jersey MEP field agent, Bucky Wellman, contacted Carlisle and performed a QuickView assessment. Through the assessment process, Bucky learned more about the company, and was able to identify the need for Succession Planning.
Bucky put together a transition plan, that will run for eighteen months, as well as a transition team that is comprised of Mr. Dougherty’s son, son-in-law and daughter. In the Spring of 2000 ownership will change hands. New Jersey MEP will continue to work with Carlisle after the transition, to make sure the business plan is being followed and to ensure the success of the company. Bucky stated, ” That this is the most important personal and business decision that a person has to make.”
Successions without planning have a low probability for success and a high probability for failure. Bucky states, “Often transitions fail – 40 – 50%, with a second generation survival rate of only 20%. Most business owners have their net worth tied up in the business, which makes a successful transition important. A successful transition should be started two to five years before retirement.”
Mr. Dougherty said, “New Jersey MEP brought them together to work together for this transition. The option of selling the business could mean a loss of jobs, if the new owners moved it out of the state, or failure.” This process is saving jobs and has created a plan that will keep the company on the right path to success.