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Staring Down Succession

November 14, 2009
By: Jeanne Bernick, Top Producer Editor

Wayne and Cindy Windmann are a rare breed in today's agriculture. They are what you might call "self-made.” Fed up with family squabbles over land, they struck out on their own in 1994. Alone but together, they were able to buy 50 acres on which to build a contract hog operation that has become more successful in just 15 years than they ever dreamed.

Cin-Way LLC is a multimillion-dollar operation that spans 535 acres and 12,400 head of hogs. The Windmanns are in partnership with their eldest son, Jared, and his wife, Leslie, and the business is poised to expand. Their middle son, Aaron, as well as their daughter, Kristy, also work for the LLC and have expressed interest in joining the family business at an ownership level.

Now, the Laddonia, Mo., couple face a challenge that surpasses anything they've experienced so far. How they negotiate the hurdle of transitioning the farm will forever change their family history.

"I'm more scared today than when I started farming,” Wayne says. "We don't know how to bring all the kids into the operation in a way that is fair. We don't even know where to start with succession planning.”

The Windmanns have a will, but no succession plan. Wayne is concerned about how to transfer the farm to the next generation while protecting its assets. And he and Cindy have only begun to think about retirement.

Mostly, Wayne says, he doesn't want to relive the troubles he went through when his parents passed down their farm. "I want my kids to be involved in the transition process, not surprised or left out of anything,” he adds. "Our kids are as much a part of this operation as we are.”

It's time to start talking. Succession is change—and change can be hard, says Kevin Spafford, Farm Journal succession planning expert.

"For most families, it's a journey into the unknown,” Spafford adds. "Most people have a vague idea of what they'd like to see happen, but like Wayne they may hesitate due to some past history.”

It helps to remember that succession planning is a natural next step for a growing operation. It minimizes risk, removes uncertainty and creates a pathway for future development. A comprehensive solution will include a plan for ownership transition, even if it's several years down the road. The current generation must have an exit strategy and a plan for transitioning responsibilities to the next generation.

When Spafford's firm, Legacy by Design, engages a new client, the first order of business is to determine if there's good communication within the family, Spafford explains. Do they talk openly, and if so, about what? Does the family employ a formal structure for business communication? Communication is critical to success, and business communication must be distinguished from family conversation.

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