How do I stop being in business?

In My Humble Opinion
1

Kind of a strange premise, but I am looking for some opinions.

Since 2012, I have operated a pretty successful food wholesale business, kind of bridging the gap between large distributors and mom and pop food stores whose volume isn’t large enough to go direct to the big guys. The business is successful in the sense that it affords me and my wife a comfortable living, but not successful enough for me to expand to the point of hiring enough people to allow me to step away completely.

My life circumstances have changed, and I just feel like I want to step away and hunker down into a 9-5 career with benefits.

The thing I struggle with is, how do I shut down my business? I have a few dozen stores who rely on me for weekly deliveries, and frankly if I went away the big distributors would eat them alive.

Not saying that I am so important that I am the only thing keeping these stores afloat, but it’s a real possibility that they would struggle for a while without my service.

I don’t want to put them in that sort of position especially after all the years they have helped me.

So in your opinion what would be my optimal exit plan?

Should I tell them, and give a timeline, like maybe 3-6 months so maybe they can rely on me less and less.

Search for a buyer? This option would be best financially for me, but who knows how long it would take, could be years.

2

Hire someone to do your job seems the easiest answer.

Or, sell the business.

3

If your business is profitable, it should not take years to find a buyer!

4

It’s possible, but could be a tall order to find a candidate willing to take on all of the responsibilities

5

My brother is in a similar situation to you, and trying to figure out how to get off his particular treadmill in his industry. In his case it’s to retire, but the business dynamics are the same.

What you probably want to find is a more successful version of your own business. Somebody who’s not the “big distributors”. They’d probably be interested in paying something for your book of business. And be able to integrate it into their operations without the difficulty of finding another person willing to replace you in your one man 24/7/365 circus.

I know nothing about your industry specifically. How is it that “if I went away the big distributors would eat them alive.”?

I’ll page these folks who’re in the grocery biz at various scales and levels; they might have useful insights: @Joey_P , @Mighty_Mouse, @Smapti, @Broomstick

6

Unfortunately I do not have any particular insight to add here. Other than to add for those not in the know that the grocery industry can be surprisingly cut-throat and brutal at times. It’s essential but not glamorous.

7

Find a buyer; consider a broker to help you sell if you don’t know who to approach about buying.

Do NOT do this. If you tell them six months, some will have that new supplier at three months, cutting your income; perhaps significantly.

8

If you are in a financial position to possibly start losing customers, I see no reason not to just be honest with your customers. You might be surprised and one of those customers might be interested in buying your business. Maybe you could even suggest that your customers form a mutually beneficial group to buy the business.
Just an idea.

9

I owned a small retail business that operated totally independently. I worked 6 days per week and made some of my own products in a home workshop. This business model existed everywhere 60 years ago, but gradually was replaced by huge corporations who were vertically integrated. The last straw was when they started an “insurance” plan to capture the business of larger employee groups through discounts only they could afford. When it came time to retire I contacted my fellow specialists to see if there was any interest in buying my little shop and there was none, I realized I had waited too long. I simply closed up. I am 6 months into retirement and doing OK but a little at loose ends after working for 52 years. Good luck, spend some time planning for your retirement and worry less about your clients. When you are gone,… believe me,… nobody will notice.

10

Just to be clear, the OP isn’t retiring. It seems he wants off the one-man 24/7 merry-go-round and wants a job with typical corporate benefits. Reading between the lines, there just might be a kid on the way. :wink:

I brought up retiring in the context of my bro selling / closing his biz. Sorry if that’s confused anyone.

But yeah, business is all about taking care of number 1. You don’t owe your customers much and they don’t owe their vendors much either. The best way out is to sell your business, which is really just your customer list & their habits of buying from you, to a similar competitor. Absent that, pull your plug no notice and your customers will shrug and go back to doing whatever they did before you appeared on the scene.


There are plenty of small businesses that employ a few people, earn a decent living for the owner / manager, but have essentially zero saleable value. Either due to obsolesence as with @sb1953 or due to the nature of the work.

I have a friend who owned a hardscape company. They do fancy driveways, patios, water features in backyards, built-in BBQ installations, etc. If it’s outdoors and made of tile, stone, brick, block, or rock, they did it. But not swimming pools.

Problem is the product is all sales, substantially zero service. And very few people need more than one such installation per 20 years. So each sale is one-and-done for that customer. Which means the business has no ongoing revenue stream asset that can be sold. Beyond the tools and equipment and list of reliable-enough workers there’s nothing there of value to anyone else.

When the owner retired, they just closed up shop. The workers went on to competitors and the trucks and tools went cheaply to other competitors. A sad ending, but inherent in the business model.

11

I agree with all that.
If you want to wash your hands of all this, tell your customers what’s going on so they have time to find new distributors and, in the mean time, start working on getting rid of existing inventory. As someone that runs a grocery store, I’d be okay with that. Not only because I’d prefer that over trying to call in an order one day and finding out that you’re closed, but also because I’d be happy to wheel and deal with you. If I normally pay $10 per case of something, I might take a pallet or whatever inventory you have left if you offer it to me for $5 each.

But, if I were you (OP), I’d be looking for a buyer. And this is where your small mom and pop store owners can help you. Sure, one of them, especially if they have their own wholesale business, as some do, might buy you out but mostly we/they know people. We know people like you, but we also know other people like you. We can put you in contact with similar businesses that might be able to help you out. Either buying your business or buying your customer list or buying your inventory.

That’s something to always keep in mind as well. I’ve told vendors that are closing as well as employees that are leaving (and feel bad about it) the same thing. We’ll survive, we’ll find a way, we always do, we have to. Great vendors and great employees come and go, it’s part of life.

12

This applies to so many areas of life. We all might as well get used to it.

13

(I was 15+ years in F&B but on a corp. level) … myt first Q:

do you hold any inventory or any future (purchase) obligations or are you basically a broker/passthrough agent?

that answer will drive the next steps …

14

Thank you all for the replies.

I am weighing options, as I still have 6 months left on my warehouse lease.

Inventory; I don’t really have much inventory, not enough to really worry about anyway, if I really wanted to liquidate it, would be easy enough to do.

Selling the business I think would be very hard because I really don’t have anything proprietary. I am a “last mile” Distributor for larger distributors. Margins are razor thin, as I only order what is ordered, and hold onto products for usually less than 5 days.

I’m kind of leaning towards just shutting down in 6 months, when I think about that, it kind of feels like a relief to me. As others have stated, it seems like just a hamster wheel, rat race sort of scenario. I do well but not well enough to move to the next level, and I just want my freedom from it.

15

I’ve never met a small business owner who wasn’t prepared to chuck it all on a monthly business.

Make darn sure you have that 9-5 first.

Job market sucks.

Working for another company that does what you do now, might gall on you, a little.

Being your own boss for so long might make you less employable.

Good luck.

16

I’ve never run a small business, but if the OP is concerned about customers of theirs that helped them, maybe they could be hooked-up with a competitor so they don’t get “eaten alive”. But, not sure if the OP has any competition they can be referred-to?

17

Who are your competitors? That’s who I’d go to first. They know what you do, how well you do it, and would probably welcome both the opportunity to make more money and remove a competitor from the board.

Otherwise, I’d just follow whatever procedures your state requires to go out of business. Notify your customers and suppliers and give them plenty of warning, and then just stop. You don’t owe any of them a thing ultimately.

18

I don’t think there’s anything wrong with running out your inventory, finishing up on the lease and walking away. It seems to me your real issue is the social obligations you feel you have to your customers. Don’t stay open just because you feel bad for them. At some point you have to rip off the band-aid so you can move on to whatever’s next for you. Tell them what’s going on and they’ll understand.

If any of these businesses are convenient for you to get to, stop in from time to time, catch up with them, do some shopping.

19

There is great wisdom here^^.

Whether in small biz or as an employee, we each have a tendency to make ourselves a hero in our own minds. My customers need me. It’s my mission to do [whatever]. Nobody else can provide the TPS reports like I can. etc. That helps us feel better about the sacrifices we’re making, whether that’s long hours, physically backbreaking work, low margins, or abusive bosses.

It’s also a trap. And because it’s a self-imposed trap, it’s hard to detect and even harder to escape. I could tell stories and stories but (for once) will refrain. I think we all get the point here.

20

My situation is very different, but the insights in this thread are helpful as I think about retirement. Thanks, everyone.