Exploring the succession planning process in Irish BMW dealerships

Abstract

This thesis is an exploratory study undertaken to analyse Irish BMW Dealerships and whether they plan for succession and the taxes to be paid on the death or retirement of the founder. This study also explores the composition of the family business and the involvement of family members in the family business to ascertain the extent of generational transition.

A substantial body of the literature is reviewed which initially defines succession in family business context. It then specifically highlights the meaning of succession planning and emphasizes the importance of succession planning for businesses. The literature review explores the many merits gained by having a succession planning process in operation within the business. Finally, the problems of succession and the ambivalence towards it are also explored, putting forward explanations as to why family businesses resist succession planning and the multitude of consequences that can arise when the process is ignored.

The research methodology involved both quantitative and qualitative collection of data. The quantitative research was conducted using postal questionnaires and follow up emails. The qualitative research focused on one-to-one interviews with a family business specialist and a senior manager of BMW Ireland.

The evidence from the analyse of the questionnaires suggests that the majority of Irish BMW Dealer Principals do plan for succession, however some of the respondents were of the belief that is was too early to plan for succession since they were still quite young. There was a general agreement amongst all the Dealerships that it was advisable to consult external professionals concerning succession and taxation planning.

The findings also suggest that many of the Dealer Principals are making provisions for the taxes to be paid on death or retirement and thus availing of the numerous tax concessions available.