Gene Beltz figures it's time.
For years, the president of Gene Beltz Shadeland Dodge in Indianapolis has been laying a track for his son, Kevin, to take over the dealership that he has operated since 1970.
Although he has been approached by megadealers and a publicly owned company interested in buying the dealership, Beltz has known for years that he could keep the business in the family. And he has worked hard to make sure that his son is well prepared.
Beltz, 64, has been shifting responsibilities gradually to Kevin, 38, whom he named general manager four years ago. By the end of the year, Beltz expects to come into the office only one or two days a week and to serve in an advisory capacity while his son makes most of the administrative and day-to-day decisions.
'I am very comfortable with him handling the decisions,' Beltz says. 'At first, being left in the dark was difficult because I am a hands-on person.'
Now, he says, is a smart time for well-established dealers to consider making exit plans if retirement or entering another business is in their future. Computerization of marketing and sales activities and Web sites have been essential for his dealership. Beltz feels the younger generation is better equipped to handle the necessary technological changes.
'This is probably a good exit time,' he says. 'I think we are going to see a drastic change in the way we are doing business. Some of it might be good, but once you are used to doing it one way, it's hard to change to another way.'
For example, he foresees more automation in sales - dealers given models and colors that the manufacturer deems appropriate for the local market.
'You won't be able to have an edge in a market where there is more than one franchise,' Beltz says. 'A lot of dealers will find it difficult to switch over to that.'
Still, he has plenty of confidence in his son's ability to adapt. Kevin Beltz has held a variety of positions at the dealership, starting as a teen and working throughout college. After college he became a salesman, then fleet-sales manager and then new-car manager. When the general manager retired four years ago, Gene Beltz felt his son was ready for the challenge.
STOCK IN THE FUTURE
Just as he gradually has been turning over more responsibilities to his son each year, the elder Beltz also has been giving stock to Kevin each of the past five years to reduce the amount of estate tax liability - a practice he plans to continue. He also has sold stock to his son, although reluctantly because of the tax consequences that has created for Kevin.
'Taxes are very critical,' he says. 'I was hesitant to sell him the stock because of the tax liability, but I wanted him to have a hard-earned investment in the business.'
Beltz says he was happy to explore his options by talking with companies interested in buying his business - in part to find out the value they placed on it. But he says that in the end, he feels much better about continuing the tradition of the independent dealer.
One of Beltz's concerns has been his staff.
'I have a very loyal staff. Several have been here more than 25 years. With some of the larger companies, I would not have been comfortable wondering how the staff might have been treated. I feel this way they are protected.'
He believes in helping the smaller dealer. Several years ago, he sold a second dealership he started in the early 1980s to two brothers - one who was one of his employees and whom he had trained. Selling that business was a sound decision, he says, as is the possibility he and his son may consider expanding into the right market in the next few years.
'I still believe in the viability of the business,' Beltz says. 'There is a place in the right towns for the independent dealer.'