Succession, exit, growth planning… These are plans that all business owners must navigate. With daily administrative and operational tasks easily consuming a full day’s work, not knowing where to begin in these conversations leaves many owners in a stagnant position, both upon scaling the business or retiring. The good news? Resources are available, and they are plentiful.
This month, we’re excited to continue our Workforce Workshop series. March marked the beginning of these conversations, with an event centered around employee wellness and mental health. In June, we continued the discussions on workforce wellness by bringing in Roy Messing of the Michigan Center for Employee Ownership to present on how cooperative ownership models aid in creating a sustainable future for your business. Roy addressed how employee ownership models strengthen workforce attraction and retention as well as long-term business planning for various industries. Through his interactive presentation, our attendees were provided valuable resources, worksheets, and more to lead them through thinking about their long-term business goals and how to achieve them. Read on to find a recap of these event and how to access Roy’s resources. 
Roy began by providing contextual information about the incoming Silver Tsunami—within the next ten years, we’ll see all baby boomers retire, the demographic that currently owns half of the privately held businesses in Michigan. Many of these owners do not have exit plans, leaving their businesses, and the employees, on unsteady ground. This is why, regardless of where the owner is in the ownership cycle, it is essential to start planning early. Doing so will greatly help scale and build wealth for the business and eventually lead to a more seamless transition. Roy provided a series of worksheets that allowed the attendees to start thinking about what’s needed to take these next steps:
- Personal Goals
- Taking Stake of Your Financial Stock
- Identifying Important Roles and Responsibilities
Roy then transitioned to speaking on employee ownership models, beginning with, “Why should businesses consider an exit to employee ownership?” Providing an orderly exit, generating tax benefits, creating a legacy in the community, and rewarding employees for years of service were just a few of the discussed perks. Roy provided further context on how to determine if a business is a good candidate for employee ownership and then covered three main options: ESOP, Employee/Worker Owned Cooperatives, and EOTs. While ESOPs (Employee Stock Ownership Plans) are currently the most popular, they are costly, timely, and generally inflexible to set up. Employee Cooperatives are a more attainable, fast-growing ownership model that requires far less capital and allows for businesses of many sizes and industries. These worker cooperatives are owned 100% by the employees, who pay a membership fee and receive patronage allocations. These are far less expensive, create more flexibility and personalization to the business, and allow the selling owner to remain some control during the sale.
Roy concluded the workshop through providing direction towards legal, financial, advisory, and educational resources for businesses interested in taking next steps, including the free Business Succession Planning Owner’s Manual from the Ohio Employee Ownership Center at Kent State University. To review Roy’s full PowerPoint, click here. 
The Local First program is dedicated to bringing workshop opportunities to our community. We are thrilled to bring more topics to the table to better workforce wellness. Stay tuned for what’s next and in the meantime, dive into these great resources!
Local First Workshops are powered by the MEDC. 
