ENID — Founding, owning and running a small business can be hard work, attendant with many of the challenges associated with running a much larger organization.
For those who have successfully built and run their own business, the end of a career poses a new challenge: finding a successor to carry on the business past its current owner.
Small business succession planning may become more important for the local economy in the near future, as a significant portion of local small-business owners near retirement age.
Business development experts at Autry Technology Center currently are working to groom new small business owners in anticipation of an expected wave of baby boomer retirements in the near future.
“Just look around Enid and see who owns and runs most of the small businesses we have here, and most of them are in the baby boomer generation,” said Phillip Gillham, a self-employment coordinator at Autry Tech.
Most of those small businesses are “family owned,” Gillham said, but younger generations aren’t necessarily interested in carrying on their parents’ work.
“If you’ve got family involved in the business, the best scenario is to keep it in the family and pass that business down to the next generation, but in many cases that’s not possible,” Gillham said.
“The choices for those older business owners looking to get out of the business all too often boil down to selling off the assets and shutting it down, and that’s not good for Enid ... it’s not good for our community, and it’s not good for our economy,” Gillham said. “Anytime we see one of those situations developing, we start looking for someone with the right background and experience to step into that business.”
Dale Shaffer, small business management coordinator at Autry Tech, said the effort to find the next generation of small business owners will be crucial as older owners near retirement.
“It’s going to have a significant impact in the near future, because in a lot of cases there aren’t family members who want to continue with those businesses,” Shaffer said.
He said business continuity is important when an owner retires, because it is easier to keep a successful venture in business than to found a new company.
“We would hope that we could find somebody else that’s interested in that business to keep it open,” Shaffer said, “because getting a new business opened and to the point of turning a profit is a much slower process with more challenges.”
Terri Holle, business and industry services director at Autry Tech, said succession planning for family-owned businesses can pose unique challenges, particularly if the business has been in one family for more than two generations.
“If it’s been a family-owned business for that long, sometimes younger family members don’t want to do it, but they don’t want to see someone from outside the family do it, either,” she said.
Holle said it will require a concerted effort between business development specialists and current and prospective business owners to plan for business succession. The alternative, she said, is “we’re apt to lose a lot of our businesses that have been here for a long time, especially our small businesses.”
The first step in planning for business succession, Holle said, is evaluating the business’ strengths, and finding any areas that may need to change to ensure the business’s future success.
“When we’re looking at business succession, we evaluate the market, and sometimes it’s time for a change in the way that business is run,” Holle said.
She said commonly needed changes in older businesses include diversification of product lines or services and modernization of equipment and practices.
“That can be hard for someone who has been running a business for a long time, to make those changes,” Holle said. “But, sometimes, the business begins to run better after those changes and they decide, ‘You know what, I’m not ready to sell.’”
She said finding prospective local buyers when a small-business owner does decide to sell can be difficult, especially when unemployment is low and other established industries, particularly oil and natural gas, are hiring.
“We have a shortage in the job force right now, and it is hard to find people to step into business ownership,” Holle said.
“For new business owners, it’s new, it’s risky and it’s difficult ... owning your own business is a lot of hard work, and when other jobs are plentiful, people are hesitant. But, there are people who have the aptitude and the energy for it, and for them small business ownership can be very rewarding and successful.”
Brian Gaddy, director of the James W. Strate Center for Business Development at Autry Tech, said the first step for people interested in owning a business is to make sure they have the business education needed to be successfully self-employed.
He was speaking during a “graduation celebration” for Grace Care Companion Services and Kalida Ventures, two local small businesses that recently moved out of the business incubator at Autry Tech and into their own facilities.
“Our goal is to empower people to be in business, and one of the things we’re focused on is providing people the knowledge they need to run a business,” Gaddy said.
He said a shortage of business education has developed in recent years, as many public school districts have shifted from business education classes to computer classes.
“Kids really need both of those in their education, but there’s only so many hours in a school day,” Gaddy said. “What we have now is a group of kids who have not had much exposure to business when they graduate, but business education really needs to be included for kids who some day might want to be self-employed.”
In an effort to fill the gap in business education for future small business owners, Autry Tech now offers enrollment in its Oklahoma Boot Camp for Entrepreneurs and Small Business Development Academy at no cost to high school students.
Gaddy said he and the staff at Autry Tech are working to “plant the seed of entrepreneurship” among high school students in hopes some of those students will become the next generation of local small business owners.
“All of those kids may at some point in their lives be in business for themselves,” Gaddy said, “and we try to plant that seed so they can look back at us a great resource to help them out when they start a business.”
Current business owners, whether nearing retirement or still in their prime, are familiar with the challenges of starting out, and of finding new entrepreneurs to join their ranks.
Carla Ruff, owner of For You!, a ladies’ apparel and gift store at 212 W. Randolph, said it can be hard to find young people who want to stay in Enid and invest in business ownership.
Ruff opened For You! five years ago after helping her husband own and operate Royal Restoration and Cleaning for 15 years. The couple now owns and operates both businesses, and are in their “prime and going strong,” Ruff said.
She said starting the downtown shop required some new knowledge, a lot of patience and determination.
“Things were tight those first couple of years,” Ruff said, “and if I hadn’t had my husband’s financial and emotional support, I couldn’t have made it.”
She said many people are reluctant to take on the hardship associated with the first few years of business ownership.
“It takes three to four years for a business to look good on paper, and we’re in an age when people want something to happen instantly,” Ruff said. “Unfortunately, you can’t build a successful business instantly. It’s a long, hard process to build your business and make it successful.”
“I would be eager to help anyone else who wants to start a business, and I think most of us feel that way,” Ruff said, referring to herself and other local business owners. “But anyone looking to start a new business needs to understand, it’s very hard work.”
In addition to business knowledge, determination and adequate financing, Ruff said prospective business owners have to “believe in and be willing to invest in” the community.
“People need to believe in their town, and not just the young people,” Ruff said. “People need to feel that the city, the community, believes in itself if we want them to stay here and open a business.”