New Zealand business owners are ranked among the highest in the world in their desire to have existing staff to buy their businesses.
The latest research by accounting firm Grant Thornton showed that 64% of New Zealand business owners are relying on staff to buy their businesses. Only Japan and the Philippines (68%) had higher figures amongst the 45 countries surveyed.
Pam Newlove, Chair of Grant Thornton New Zealand’s Board, said that such a high figure highlights the importance of business owners having a comprehensive, long-term, plan in place, to ensure this will happen.
"One of the big pressures on businesses at present is retaining staff. Unemployment is down to 6%, one of the lowest figures for several years, so holding on to staff is the first priority.
“This means key talent must be nurtured. To retain staff from Generation X and Y, employers will need to be innovative in their management styles. This may come as a surprise to more traditional thinking business leaders.
“Buying a business is not a spur of the moment consideration. Owners need to be asking themselves today: ‘Is there a staff member capable of running this business? Would they want to? How will they finance it? And how many years will it be till they are ready to take over?’
"And that’s really just the start."
Newlove said that it is a particularly important subject in New Zealand because of the high number of privately owned businesses looking to change hands in the next 10 years.
"Our most recent research shows that a staggering 69% are looking to do so. We are an economy based on small businesses so that is an enormous amount of change, mainly relying on existing staff to step up and stump up the money.
“It’s interesting that so many business owners consider that there is such talent within the business and that those employees will have the desire to make the ownership commitment.
“Therefore it’s important that business owners sit down with the desired employee to investigate suitability, appetite and to plan the future transition.”