Who Will Take Over When Pop Retires?
by Kate Beem
Staff Reporter of The Wall Street Journal
This article is reprinted by permission from StartupJournal.com.
It took a quadruple bypass for Jay Rains to get serious about handing over family-owned Rains Electrical Sales to his 36-year-old son.
The firm — an electrical-equipment wholesaler in the Kansas City suburb of Shawnee, Kan., for electrical-equipment manufacturers — has been tightly controlled by the 65-year-old father for years. Wes Rains, his son, concentrated on his work as a salesman in his 10 years at the firm, which has eight employees and has $15 million in sales. He didn’t demand, nor was he encouraged, to learn mundane necessities such as payroll or income-tax withholding or legal issues. That left him, he says, unprepared to run the firm should something happen to his father.
“I don’t even know what everybody makes,” Wes Rains says. “There’s just so much paperwork and legalese.”
His father’s successful surgery in December forced both men to confront the thicket of emotional and financial issues involved in succession in a family business. But even now, the elder Mr. Rains isn’t handing things over right away. They’re just beginning a planned four-year transition, after which Mr. Rains says he’ll pull back and concentrate solely on schmoozing customers, leaving his son as the boss. More…