The Succession Decision: There Are Many Paths to Finding New Ownership
Running a printing business is more like a long hike on a rocky trail than it is a walk in the park, and succession planning — the decision of transferring a business to a new owner — is when that rocky trail divides into several alternative trails. All the trails go somewhere, and each could be the right choice. Which will take you where you want to go? Which will move your business into its best future? Finding your way is assisted by the experiences of those who have walked the trail before you.
Over and Out: Selling to a Private Party
As the sole owner of DynaGraphics — a Reno, Nevada-based commercial printing business — Cindy Mason, alongside her brother, had a change of heart after taking over the business from their father in 1997. “I decided I didn’t want to do it for the rest of my life,” she notes. “I wanted to find something different.” In May 2021, she put the business up for sale. It sold in November 2022 to a private party. Selling the company outright, Mason adds, “was the only direction I could think of,” given that there weren’t any family members to turn the business over to.
Looking back, she says, “I’m relieved to have the stress off my shoulders. I wish I had done this earlier.” Within the sale, she maintained a strong responsibility for the company’s employees and their livelihoods. It was important for her to maintain their benefits.
Mason explains the process of selling the business included a “discovery” period, which was roughly a year and a half spent producing documents. “I didn’t think it would be that much work,” she adds. All totaled, there were no surprises: “We’ve run a pretty clean business.” The process, she says, also included a lot of discussions with attorneys, given that the company’s real estate was also sold.
Mason stresses that those interested in selling their businesses should seek an accurate valuation of their business. “People always think their business is worth more than it is,” she points out. It might have been, she says, before the onset of COVID-19 — the effect of which factored strongly into Mason’s decision to sell DynaGraphics. She also advises working with a good attorney and a good broker.
Mason says she is no longer engaged in the day-to-day operations of the business. That said, she’s willing to answer questions as needed and is committed to seeing the company survive under its new owners. Beyond that, Mason’s path forward is still forming. Having sold her business, she says, “I feel free and look forward to enjoying life. I was brought up in the industry and will miss it. It will be a lot different, but I’m excited.”
Generational Succession Within a Family
For packaging company Meyers in Minneapolis, Minnesota, Chief Revenue Officer Michael Dillon says succession of the business to the third generation of the Dillon family, “was in the best interest of both the company and its stakeholders.” He says there was great interest for the producer of retail brand packaging, product labeling, and retail merchandising displays to remain family-owned, and “the stages of life lined up well for this to happen.”
The generational succession at Meyers, Dillon admits, was both complicated and prolonged, and its end point was not a foregone conclusion. While the company was family-held, ownership was among parents and other second-generation owners, who began the succession discussions, more than 15 years ago.
“Much had to be figured out,” he recalls, “and there was a lot of discussion, negotiation, and consideration of options.” Amid the process, the Meyers team sought the expertise of a legal team, accounting company, and a business broker: “Their services aren’t free, but they’re worth every penny.”
While it is easy to view this succession to Michael Dillon and his cousin, Meyers CEO Chris Dillon Jr., as simply a legal, family-based transfer of a business, the fact that Meyers ownership was an extended group of family members with differing ambitions, priorities, and timelines made it far from simple. Dillon says that throughout the process, asking what the company should look like, and what it means to the family, was essential. Also essential, he says, is listening and empathizing, which will help bring success. “To have everyone in the family be happy, you need to empathize.”
As Meyers moves forward under a new generation of family leadership, Dillon says he is interested in using his previous experience in software-focused startups — where he was “able to work on things that have a purpose for people and communities — with the goal of building a 'truly great' company.” With, for instance, sustainability as an ongoing commitment, he says generational change is the opportunity needed to take the company in a new direction.
For those considering a generational succession, Dillon says they should start working with outside experts early to learn the company’s value, and the factors that might drag a sale down. Further, he says sellers should understand they may not realize their emotional connection with the company until they are no longer the owners.
Staying in the Game After the Sale
In 1997, Janice Tippett — having started a graphic design firm in her parents’ basement in 1990 — purchased a small printing company, which she and her sister and partner Jody Franklin built into Millennium Marketing Solutions. They sold the Annapolis Junction, Maryland-based integrated marketing agency to Ironmark, which is owned by Post Capital Partners, last August.
Her succession plans changed dramatically when her nephew, who was fully expected to take over the company, died suddenly at age 35. Finding an external buyer then became the most logical path forward.
Tippett started her succession process because she felt the size of Millennium Marketing Solutions made it an attractive purchase. “Looking at the industry,” she points out, “I felt the business was at its optimum value. I still had energy. We hadn’t run it until the end.” She believes it is important for business owners to begin their succession process while they still have the passion and the emotional investment to see a deal go through.
Efforts to sell the company began in earnest, Tippett reveals, when she reached out to Graphic Arts Advisers, which became a key member of her succession team. Other members included her personal financial planner, a CPA, and an attorney. She urges others seeking to sell to start early and compile a team that will assist in the success of the sale.
Early in the process, Tippett says a primary concern was confidentiality — wanting to keep her intentions private until the right time. Once offers for her company began coming in, concern gave way to excitement. She describes the process of finalizing the deal as stressful: digging for needed information, making sure all needed details were addressed, fostering forward progress.
In the end, Tippett was excited the deal was done, but needed to make the adjustment of no longer being the company owner. “That’s a little bit of a roller coaster,” she added.
Though Tippett no longer owns the business, she is excited to be a part of Ironmark, where she serves as VP of strategic development. She credits Ironmark CEO Jeff Ostenso and Matt Marzullo, president, for giving her a platform in the business, and for helping customers get the best marketing services and Millennium employees an opportunity to grow their careers.
About her new role, “I feel like I’ve moved from being a parent to being an in-law. It’s an adjustment.”
Selling and Transitioning to the Next Chapter
For Ted Ford and Bill Knepper, co-owners of Knepper Press — a commercial printing company headquartered in Clinton, Pennsylvania — selling their company was a logical next step. Both were nearing retirement age, according to Ford, the company CEO. A generational transition was not in the cards, he says, and a great management team was in place.
The company maintained a strong equipment portfolio. Both owners were healthy. They decided that the timing was right.
About a year ago, Ford says, he and Knepper decided to start a search for the right owner to take over the business. After exploring several options, including the decision to partner with New Direction Partners to broker the sale, Knepper Press and Dual Printing & Mailing were sold to Sarasota, Florida-based JAL Equity, which, according to its website, executed 17 acquisitions during 2022.
Even under new ownership, the Knepper Press team has stayed in place. Ford says he is currently serving a one-year employment contract, which he could see extending if needed. His current goal is focused on “transition, keeping things running … finding synergies.”
For Ford, the succession process started with “getting my head around the decision,” and understanding that a sale really was going to happen. He says preparing Knepper Press for a sale resulted in no surprises: “We run a clean balance sheet, so getting the business in place was not hard. There were no legal entanglements.”
With the help of New Direction Partners, the business was listed and sold. Asked how he felt when the deal — after more than a year’s work — finally closed, he says “I felt good about the buyer, and about getting the deal done. We got a fair price.” Ford adds, however, “It feels like the end of an era.” Even so, he is pleased to note that, since the sale, the company has added employees. The sales team is also happy to be selling within a broader network.
Looking forward, Ford isn’t sure what’s next after he leaves Knepper Press. “It could be full retirement, charitable work, travel, but it won’t be a business pursuit.” He advises fellow printing business owners to start thinking about their succession 10 years prior. “Have it in your thought process,” he says.
Whatever rocky path you choose on the journey that is your business, it is important to consider that venturing into uncharted territory by yourself is an unnecessary risk. You probably need a guide. Someone to deliver your business safely to its future, and you to yours.
In all of the companies profiled here, the use of an M&A specialist to broker the transaction eased the process and likely delivered better results.