From family-owned business to EO – one company’s story
‘Our employees are the heartbeat of our company, both past and present, and to be able to transition in the right way was really important to us all’ Sarah Pym-Eaton, Finance Director and family member, Pym & Wildsmith
Family businesses – valued as the bedrock of their community, many have been hit hard by this turbulent year. Yet today more than 5m of them are still providing vital employment for 14m people across the UK.
So what happens to succession planning when the next generation wants something different – and a trade sale or MBO just doesn’t feel right? Transitioning to EO is one option for a family business that can safeguard the founders’ legacy, while freeing the company to shape its own path.
Pym & Wildsmith is a family business that became EO last summer so, to mark the IFB’s Family Business Week 2022, we asked Financial Director Sarah Pym-Eaton and MD Craig Taylor to share their experience for others considering the same.
Showing resilience in difficult times
Pym & Wildsmith’s transition didn’t follow the ‘usual’ path. On the eve of the original planned handover, a serious fire damaged the specialist metal finishers’ factory. Although nobody was hurt, the fire caused major issues for the Uttoxeter company and delayed the EO transition by 10 months.
However, the fact that Sarah, brother Ian (Technical Director) and their parents Wendy (Finance and Administration Officer) and Steve (now retired) had already invested such care in their preparations stood them, and their business, in good stead.
‘It’s not until you experience adversity together that you see how resilient you are,’ Sarah recalls. ‘I couldn’t have been prouder of how the team, led by Craig, worked to get us through.’
Exploring EO as a succession plan
So where did Pym & Wildsmith’s EO journey begin? ‘As a family, we’d been thinking about succession planning for several years, but nothing fitted until I discovered EO,’ Sarah reveals.
Curious to learn more, she did her ‘homework’ – joining the Employee Ownership Association, attending virtual networking sessions and connecting with other EO businesses to hear their stories.
Six months later the decision was made.
‘We could see EO was the best option for us personally, our company legacy and for our extended ‘family’ of Pym & Wildsmith workers,’ says Sarah. ‘Our employees are the heartbeat of our company, both past and present, and to be able to transition in the right way was really important to us all.’
Shaping the transition you want
With this in mind, the family made a point of engaging trusted advisors to help shape the process – RVE for the legal/financial transaction and JGA to support the cultural transition and employee owner engagement.
‘We’d learned from existing EO businesses that one of the things they’d do differently was to focus on the cultural side earlier, so they could unlock EO’s benefits sooner,’ says Sarah. ‘So we engaged JGA to help us to shape our transition and bring different people into that journey at different times.
‘It started with the Founders’ Workshop and creating our Founders’ Wishes document, followed by involving Craig, the SLT, our employee groups and finally our employees.
‘We invested a lot of thought and care because we wanted to get it as right as we could without constraining the team moving forward. Lisa Fryer’s support has been invaluable, both then and now.’
A chance to be a catalyst for change
As then Operations Manager, Craig was the first leader to be brought in on the family’s plans. He became MD in July this year.
‘To be offered a stake as an employee owner in a company as longstanding as Pym & Wildsmith felt like a real investment in me as an individual,’ he recalls. ‘It was an exciting opportunity to be a catalyst and drive the change.’
It was also, he agrees, a challenge – especially ‘the journey of bringing the rest of the team up to speed’ on EO before the transaction took place. ‘Having Lisa’s support to break down barriers and bust myths was invaluable. The fact we went so far to engage our teams beforehand allowed us to tailor what’s right for the founders and right for me as MD and the business.’
His current focus as MD is, he explains, strategy, values and vision. ‘EO is about people having a say, so our priority now is to define and differentiate who we are as an EO business: we didn’t want to present a finished article before we transitioned.
‘With JGA’s help, we’re supporting and educating our teams to join us on the journey. This is a monumental change and a challenge, especially in the current economic climate, but we have a good strong team to deliver our ambitions and bring our EO to life.’
What should you do next?
And bringing EO to life is integral to unlocking EO’s benefits. So what should you do next?
Here, Sarah and Craig share 5 practical tips for family businesses exploring EO:
Do your research. Joining the EOA will give you the best start thanks to its wide range of information, support and resources. ‘The EOA were very kind in connecting me with others,’ says Sarah, while Craig loved his time at this autumn’s EOA Conference 2022.
Connect with other EO businesses. The EO community has a great network of new and established EO companies happy to share their own experience of EO’s challenges, opportunities and rewards.
Engage trusted EO advisors. Not just for the legal and financial transaction, but to strengthen the cultural, commercial and engagement process too. Pym & Wildsmith was supported by RVE and JGA.
Take time to shape the transition. Letting go as an owner can be daunting, but becoming EO gives you more control of the process and allows the transition to happen in a more structured way. Leading in an EO business involves a different level of responsibility, so make sure you strengthen your board to step up too.
Allow time to embed the change. Every transition is different, but some owners initially stay on – Sarah, Ian and mother Wendy remain part of Pym & Wildsmith. ‘As a family, we wanted to ensure we were still here during this next stage to support everyone to find their feet and give a gradual transfer of knowledge,’ says Sarah. ‘It was another big tick in the box for EO.’
‘With JGA’s help, we’re supporting and educating our teams to join us on the journey. [Transitioning to EO] is a monumental change and a challenge, especially in the current economic climate, but we have a good strong team to deliver our ambitions and bring our EO to life’
Craig Taylor, MD, Pym & Wildsmith
Want to know more about how we can support your family business to transition or unlock the benefits of becoming EO? Get in touch here.