Putting the ‘success’ in your succession plan

Over the next 15 years, nearly 12 million businesses are expected to change hands, but 60% of business owners have no formal succession plan. Creating one is an opportunity to strengthen your business, support continuity, help preserve value and instill confidence in your people about the future. A succession plan can help your business continue to thrive, even after you step away.

This Small Business Month, we’re recognizing five community-beloved small businesses as National Treasures. We highlight their stories here to show how a smooth transition in ownership is achievable and can open the door to new possibilities for years to come. By taking note of their stories and developing your own formal succession plan, you can help protect the legacy you’ve built while preparing your business for what’s ahead.

The best transition strategies start early

Succession planning is more than a good idea. It’s essential for longevity. Transitioning without a written plan opens the door to organizational chaos and financial or emotional strain on employees, along with potential risk to your business value. That means the best time to start preparing is right now. It’s important to give yourself ample time to think through each choice and get ready for what could be a career-defining change. Here are a few common barriers and how to overcome them: 

Succession success stories

Even though it’s essential, a smooth succession is easier said than done — and there’s no one-size-fits-all approach. Fortunately, many small business owners have been exactly where you are today, and their stories can serve as examples of the different paths to success.

Borgatti’s

Established in 1935 by Lindo and Maria Borgatti, Borgatti’s Ravioli & Egg Noodles has become a staple in the Bronx’s Little Italy. For over 90 years, the shop has operated in the same location under the family name, using the same family recipes Maria brought with her from Bologna, Italy. On the surface, it may look like not much has changed, but the pasta shop has evolved over four generations of Borgatti ownership.

All six of Lindo and Maria’s sons worked at the store at one point, but Mario always went the extra mile. After graduating from high school, he learned how to make the ravioli that put their business on the map — and implemented the back-end logistics that have helped it stay there. Mario eventually inherited Borgatti’s and continued running the family business. When his son Chris graduated from high school, Chris followed in his father’s footsteps. Today, he and his wife, Joan, are joined by their own son and daughter, who are poised to continue the legacy.

You could say pasta making is in the Borgatti DNA, but the real reason this multigenerational handoff continues to succeed is because each new generation introduced someone passionate enough to live and breathe the family business.

Succession planning tip: Sometimes the best successor is already in business with you. Don’t overlook family members or star employees who have remained close to operations over the years.

Participants compensated

“In some family businesses, knowledge is treated like a secret and kept guarded. We’ve always taken the opposite approach — we teach everyone who works here how to make pasta and how the business operates. You never know when someone will contribute an idea that helps improve or build on what came before.”

—Christopher Borgatti Sr.

Montemayor Britton Bender Carey PC

Headquartered in Austin, Texas, Montemayor Britton Bender Carey PC is a certified public accounting firm founded in 1996 by president and CEO Arturo “Archie” Montemayor III. Under Archie’s supervision, the firm has specialized in audits, consulting and accounting services for nonprofit organizations, earning client and industrywide respect for its commitment to quality — a reputation the firm has maintained through its recent succession.

Instead of completely taking his hands off the wheel, Archie transferred ownership shares to key employees within the company while staying on in his current role. Both strategic and inclusive, this move allowed Archie to empower those who had shown a deep understanding of his company’s values and open the floor to fresh perspectives — all while keeping a guiding hand on the firm’s trajectory.

No chaos. No turmoil. Archie’s approach maintained stability and client trust throughout the transition, proving that sometimes lessening the impact can leave the largest impression.

Succession planning tip: Investing in internal talent can be a thoughtful and strategic way to secure your business’s future while fostering a collaborative environment for new thinking to evolve.

Participants compensated

“When it comes to succession, we learned the importance of considering selling to employees rather than on the open market. And when you sell to employees, it’s important to consider all the hard work they have put in and to sell at a fair price.”

— Archie Montemayor

Heritage Vision Plans

In 1975, George P. Barnes Jr. became the first Black man to open a full-service optical dispensary in Detroit. Later, in 1991, Heritage Vision Plans became the first minority-owned company in the area to hold an Alternative Financing Delivery System Certificate of Authority from the state of Michigan. And although he made history twice, George has never taken his eye off his business’s future.

In 2006, George split the enterprise into two separate companies — Heritage Optical and Heritage Vision Plans, Inc. With those two companies and three retail locations across the Detroit metropolitan area, Heritage is now a thriving enterprise that George describes as “a legacy for generations to come.” In fact, he brought his two children, Tracey and Lenny, into leadership roles to help him shape the next chapter of the business.

Succession planning tip: Short-term growth is important, but so is keeping the bigger picture in mind. Who will you want to continue expanding your legacy once you’re gone?

Participants compensated

“Be prepared to have open and candid conversations about how you see the succession playing out. As the owner, you’ll have to clearly identify roles and responsibilities as you see them. What’s the ownership structure in the succession plan? Who do you see as the leader? Will there be conditions for sale of the business for the successors? These and many other questions must be addressed.”

— Lenny Barnes

Wheelwright Lumber Company

Not many businesses have been in the same family for over a century, but Wheelwright Lumber Company has. In 1890, when brothers Thomas and George Wheelwright opened a secondhand store to offer much-needed handyman and repair services to their Ogden, Utah, community, they unknowingly laid the groundwork for a business built to last.

Now operated by fourth- and fifth-generation Wheelwrights, the Lumber Company is a cornerstone of the greater Ogden area. Despite changing hands several times, the company has remained stable over the years by never losing sight of its driving force: community. Even today, the current owner, Paul Wheelwright, puts Ogden first through charitable donations and other local philanthropic efforts.

Succession planning tip: In succession planning, foresight is everything. Think about who shares your values and can uphold your vision, then add the necessary safeguards to keep your legacy intact.

Participants compensated

“The hope is that you have a family member who is capable and willing to carry on the business. Remember to involve your family employees in all aspects of the business and provide advice and training along the way.”

— Paul Wheelwright

V&C Foods

Founded in 1945 by Victor and Charlotte Cortesi, V&C Foods began as a ranch-fresh egg distributor for San Francisco bakeries. The company grew steadily under Victor’s leadership, supported by a group of key employees that included his youngest daughter, Judy, and a rising young route driver, Steven Herrera, who climbed the ranks to eventually become the operations manager.

In 1994, the company moved to a larger facility, and shortly after, Judy and Steven became business partners. Together, they continued the work Judy’s father had started, broadening V&C’s clientele and offerings even further until Judy’s retirement in 2005. She relinquished her remaining interest to Steven, who has since expanded V&C into a full-service dairy supplier for many of the Bay Area’s leading chefs.

Today, the family business roots of V&C live on through the Herrera family. Finances are managed by Steven’s wife, Liz, the sales team is led by their daughter, Victoria, and operations are managed by their son, Adam, who is slowly preparing to take the reins as Steven approaches retirement.

Succession planning tip: A skilled partner can be as good as family. As long as you’re aligned on values and vision, they can be an unbiased ally to champion your business’s future.

Participants compensated

“In today’s economy, it is common to see people bounce between different companies at a rapid pace. We strive to mentor our employees, find the right leaders, and develop and retain a strong team so we can continue to serve our clientele for years to come.”

— Steven Herrera

Putting your plan into action

Now that you’ve read real-world examples of succession done right, you can get started on your own plan with these five steps:

The right partner to help you navigate what’s next

Protect the legacy you’ve built with a thoughtful succession plan — and remember: This isn’t something you have to figure out on your own. Whether your exit is months or years down the road, JPMorgan Chase is here to help. Check out the J.P. Morgan Wealth Management article “Introduction to Succession Planning for Business Owners,” the Chase for Business^® article “5 Things To Consider Before Heading for the Exit” or The Unshakeables^® podcastOpens overlay from Chase for Business. Then get in touch with a Chase banker to discuss your options.