Case Study: Goodwin Sporting Goods
I – STATEMENT OF THE PROBLEM
Given the family situation and the President’s foreseeable retirement, should the family business, Goodwin Sporting Goods, be sold? How can the second generation handle their retirement?
(In both situations where the business is sold and when it is not)
II – OBJECTIVES
1.To decide whether the family business be sold or not.
2.To have a plan for Jim Jr.’s and Pam’s (second generation) retirement.
III – AREAS OF CONSIDERATION
AC1No succession plan was ever established.
AC2At Jim Jr.’s entry into the business, a direct sales model was implemented upon his recommendation to better the financial position of the company. AC3Jim Jr. fully acquired the business from Paul, his uncle, after his father’s death. AC4The company remained a regional leader throughout the years. However no additional investments were made to further the company’s growth, despite the third generation’s expressed desire to. AC5The business was well; however, the family had issues with their personal cash flow. It can be assumed that despite their wealth, the family had monetary concerns and were not able to address them. AC6Jim Jr and Pam considers selling the family business.
AC7There are no mentions of Jim Jr.’s approval or his confidence in having Peter fully manage the business. The Goodwin Family Genogram also suggests that Jim Jr and Peter are in conflict. AC8Jim Jr.’s successors are Peter, Mary and Fred. Fred suffers from illness. Mary is married and with family. Peter is the suitable successor to the business. AC9Peter has no other working experience. The family business is the only place he has ever worked in. AC10Jim Jr. and Pam had no estate plan.