Majority of family- owned businesses lack succession plan

When charismatic restaurant owner Marco Abdi died unexpectedly in February, his family was left with the difficult decision of what to do with the popular La Brezza restaurant that’s been a Bridgeland fixture for nearly 30 years.

“We never discussed what would happen in the future to the restaurant — who would take over,” said his widow, Filomena Abdi, who recently decided the business would stay in the family.

“The key decision for me was first of all supporting my family. But also more important, I felt like La Brezza has reached its peak and we’re here and we need to continue running this,” she said. “It would be such a shame to not have it around for the next generation to come.”

Abdi said it’s not surprising that many family- owned businesses don’t have succession plans.

A report by the Canadian Federation of Independent Business found about half of business owners do not have a business succession plan, either formal or informal.

“Succession planning is a necessary step in the lifespan of any business and it is never too early to start,” said Amber Ruddy, senior policy analyst with the CFIB in Calgary. “Succession planning is not a one- time exercise, but should be ongoing and regularly updated as circumstances change.”

The Institute of Family Enterprise Advisors said 64 per cent of family- owned businesses have no process for selecting a successor, while 70 per cent have no successor in place. Yet, family- owned businesses account for 60 per cent of new jobs in Canada and employ 4.7 million people, the group says.

“They get very involved in running the business and very much forget about the importance of long- range planning for succession,” said Todd Coleman, vicepresident of succession planning for BMO Private Banking.

“It’s extremely important especially in a family business because in a family business you overlap a lot of technical business elements with some very emotional family elements. So it can be very tricky to navigate the emotional complications of something like that.

“If an owner is suddenly unable to work or passes away, it can create very big challenges for a family.”

TED RHODES/ CALGARY HERALD Filomena Abdi, standing, says there was no succession plan in place when her husband Marco Abdi, owner of the popular La Brezza restaurant, died unexpectedly in February.