What If You Do Nothing? is a section based on real-world experience. Some details in the article have been adjusted to ensure business confidentiality.
In many family businesses in Vietnam, there are companies that have existed for decades, have stable customers, and their revenue continues to grow steadily year after year.
From the outside, these are very stable businesses.
- They have market experience.
- They have a long-term, committed workforce.
- They have a network of established customers.
But sometimes, the biggest challenge for these businesses isn’t the market or the product.
The challenge lies in the transition period.
The story in this article comes from a chemical trading company that has been operating for over 30 years. Revenue continues to grow, the workforce is stable, and many employees have been with the company for more than a decade.
But as the founder enters a new phase of life, a question begins to become clearer: who will continue this business in the future?
What if you do nothing when a family business is running smoothly?
The business in this story was built by a founder from the 50s-60s generation.
After more than three decades of operation, the company has built a fairly stable customer base in the chemical trading sector.
Revenue has grown steadily year after year.
The workforce is stable, with many employees having worked there for over 10 years.
For many years, the company’s operating model was quite simple.
- The owner is directly responsible for sales.
- Customers typically work directly with the owner.
- Business relationships are built on personal trust.
For a long period, this model worked very effectively.
But over time, a problem began to emerge.
When the next generation doesn’t follow the same path:
The founder’s children studied abroad and worked for large corporations overseas.
At one point, the second generation returned to take over the business.
But after a while, they decided to return abroad and settle there.
The reason isn’t that the business lacks potential.
It’s because the operating methods of a long-established family business are sometimes very different from the professional management environment of large corporations.
When they can’t find common ground on management, the successor generation chooses a different path.
This causes the business to revert to the familiar model: the founder continues to run it.
A Time When Businesses Need to Prepare for the Future
About three years ago, the founder began to realize that the business needed to prepare for a new phase.
He contacted Mind Connector with the desire to create a change.
Right from the first meetings, a goal was quite clearly defined.
If the business lacked a successor generation, a logical course of action might be to prepare to sell the business to a suitable partner.
But to do that, the business needed a crucial preparatory step.
- It’s not just about financial records.
- It’s also about the image and brand reputation of the business.
When businesses believe branding is unnecessary!
At that point, Mind Connector suggests that businesses begin standardizing their brand image.
This includes:
- Brand identity system
- Corporate image across online and offline channels
- Communicating the company’s history and capabilities
The goal isn’t marketing in the conventional sense.
The goal is to create a strong enough business profile to increase its value when sold.
But the founder had a different perspective.
He believed that building a brand image wasn’t really necessary.
The reason is simple: for many years, he was the one directly selling the products, and customers only dealt with him.
The business still had orders.
Revenue continued to grow.
Therefore, investing in standardizing the brand image was considered unnecessary at that time.
Three years passed.
After three years, the founder contacted Mind Connector again.
This time, his wish was quite clear: to sell the business.
But looking back at the entire business, a problem began to emerge.
Despite having existed for over 30 years, the company’s image remained stuck in the model of a small family business.
- The brand profile has not been established.
- The company story has not been clearly communicated.
- The brand identity system is virtually nonexistent.
From the perspective of investors or buyers, this makes valuing the business more difficult.
A business with a long history but lacking a clear brand image is often perceived as a small business, heavily reliant on the individual founder.
As the market landscape changed,
Simultaneously, another factor began to affect the business.
Government regulations on chemical management became increasingly stringent. Some chemicals that were previously easy to trade were now subject to stricter controls.
This made business operations more difficult.
Meanwhile, the founder was unwilling to continue investing capital to import more goods.
As revenue tended to decline, but fixed costs remained, financial pressure began to mount.
At this point, the founder made a quick decision: to sell the business to cut losses.
When selling a business under time pressure:
When a business is prepared for sale early on, the transfer process usually has more advantages.
- Businesses have time to build their profile.
- They have time to find the right partners.
- They have time to negotiate value.
But in this case, the decision to sell was made under rather tight deadlines.
This meant the business’s value couldn’t be determined as highly as expected.
Ultimately, the founder accepted selling the business at a lower price than initially desired.
And according to the agreement, he still had to remain with the company for a year to support the transition process before completely withdrawing.
Lessons from a Decision to Procrastinate
This story isn’t about failure.
The business has survived for over 30 years – something not every company can achieve.
But in retrospect, there’s an important lesson.
In business, there’s one element that’s often underestimated: the soft power of a brand.
- It’s something that isn’t always immediately visible.
- But when needed, it can make a huge difference in a business’s value.
There are times when investing in branding might seem unnecessary.
But in many cases, missing that moment means the opportunity is lost.
It’s like a fruit on a tree.
When the fruit ripens at the right time, it can be harvested at its best value.
But if you don’t recognize that moment, the fruit might be eaten by birds, fall to the ground, or lose its original value.
The same applies to business.
Whether a business is small or large, whether it has existed for 20 or 30 years, the story of the soft power of branding remains a crucial factor alongside revenue growth.
