Families must plan for business succession
Foods of Athenry
The Foods of Athenry is a family business run by Siobhan and Paul Lawless. In 2004, Siobhan and Paul stepped out of the dairy business to pursue their dream of a bakery based on fresh ingredients. Seven years later, at the height of the recession, they added a dedicated gluten-free facility to the operation, meaning they could expand their love of good food into certified gluten-free and vegan products.
A speed bump in the summer of 2011 in the form of a fire burnt the whole operation to the ground, closing the business for nearly 10 months. They were heavily supported by their local community who rallied together to help get the business back to full strength.
Some hard years followed but the efforts are paying off with substantial growth in recent years. The Foods of Athenry have also won 38 taste awards over the last six years including being named as producer of the year in 2013 by Good Food Ireland.
Eugene McMahon, Partner, Mazars
Siobhan and Paul bring vision, enthusiasm and hard work to the delivery of long-term strategic objectives. But alongside their commitment is the need for sufficient finance to allow them to grow and develop. There is a wide range of options available to SMEs. The most obvious is existing bank relationships and may come in the form of overdraft, term loans, bridging finance, finance leasing or similar tailored products.
The local enterprise offices are a good source of advice and information. In addition, there is always the option of considering further equity investments from a range of sources which potentially could include Enterprise Ireland, business angels, venture capital funding and EIIS.
Paul Mee, Partner, Mazars
It's clear that the company's future growth is dependent upon export sales. Two key tax issues to be mindful of when expanding overseas are VAT and foreign jurisdiction tax. It is critical when dealing with business-to-business type customers within the EU that their VAT numbers are verified to ensure exports can be zero-rated. Otherwise, Irish VAT must be charged and there may also be local VAT compliance issues.
It is also critical that the Lawless family begins to plan for the business succession. Even though they are many years from retirement, it is crucial that the planning process begins before the age of 55, to ensure tax relief such as CGT retirement relief and CAT business relief can be availed of on a business transfer or sale.
Sunday Indo Business