Many entrepreneurs who start and grow a business hope that someday their family – specifically their children – will take over running the company. Even better, the business would pass from generation to generation into the future.
That’s a legacy that appeals to many of us. But making the transition can be trickier than it seems – and is fraught with all manner of bear-traps.
Leyland SDM was an independent family-owned business established in London in 1985 providing an extensive range of decorative and DIY products to both the professional trade as well as the general public, with 17 retail stores in prime London locations.
Leyland’s new CEO – son of the original founder – arrived into a “comfortably numb” business – well established stores, long-serving staff, and a loyal but limited local customer base. Despite lacking formal retail or business experience, the new CEO was clear in his mind that the traditional retail model he’d inherited would struggle for future survival against bigger rivals.
The new CEO was naturally keen to continue to honour the family business’ proud heritage and traditional values. However, he was concerned that the company wasn’t fit for the future, and pragmatic in his recognition that the long-term survival of the business might well depend upon a future trade sale or external investment.
He knew they must evolve to survive – but which way to turn?
We were approached by the CEO to advise on mapping out his options for the future of the business, eventually settling on a three-stage strategic plan:
- Consolidate as the dominant independent player in London.
- Launch a major national expansion programme.
- Achieve market-readiness in anticipation of industry trade sale / institutional investment.
RMC were initially asked to undertake a consultancy review of the organisation, structure, and operating processes. Our diagnosis revealed that the business was far from mission-ready, highlighting critical key skill-gaps in the team, major weaknesses in supply-chain management, and also deep-rooted cultural legacies which were proving an immediate barrier to growth.
To resolve these issues, a two-phase remedial plan was put in place. Firstly, we conducted a series of immediate tactical hires to strengthen the existing senior leadership team. Secondly, we appointed a specialist Consultant to oversee the transition of the company’s entire warehousing and supply chain functions to a brand-new, purpose-built facility in North London.
We recognised the crucial importance of bringing on board a Consultant with just the right blend of corporate blue-chip career experience and pedigree, but also who would be capable of adapting to a much smaller and less structured independent trading environment.
Our Consultant was subsequently retained on a long-term basis to manage this major programme of strategic change, including scoping and design of the Warehousing facilities, and the integration of an all new ERP system in readiness for expansion. Viewed as a colleague rather than outsider, he was able to win consensus and support for his ideas and recommendations, and he was eventually handed executive authority for all trading and operational issues by the CEO.
Within a few months of the new Warehouse facility opening successfully, Leyland began to appear on the radar of several large sector rivals, and in 2018 was acquired by multi-national builders merchants & DIY giant, Grafton Group PLC.
We are enormously proud of our impact upon every strand of this traditional family business, making it future-ready and an attractive investment proposition.
Moreover, the project conferred a satisfying legacy: all staff were retained after the trade sale, the Leyland SDM brand name continues to live on in London’s high streets, and the CEO was able to honour the family heritage whilst maximising the full value of the business in a volatile and ultra-competitive market.
“As a medium-sized retailer, I was somewhat apprehensive about deciding to make substantial changes to the management structure and operational procedures in the company. However, the team from RMC made the whole process far more manageable than I could ever have imagined.
What impressed me most of all was their uncanny ability to understand my business and most importantly appreciate the requirements of the roles and responsibilities for the new positions I asked them to recruit for. I was presented with impressive shortlists of a cross-section of candidates, all of whom I found appealing and thought would bring value to my company. And all of which was accomplished in a much shorter time-frame than I had anticipated.
As a result of RMC’s help, I achieved strategic objectives and made substantial improvements that I could have only dreamed of.”
Managing Director, Leyland SDM