Question

A founder is thinking about retiring and has no children who are interested in taking over the family business, an agricultural products manufacturer with about 100 employees. The business is stable, profitable, and growing at a moderate rate. A team of managers has been assembled who are capable of running the business without the founder’s involvement and employee turnover is low. Which of the following "harvesting strategies" would give the founder a way to fund their retirement while also providing an incentive for managers and employees to continue to grow the business?A. Sell the businessB. Undertake an IPOC. Establish an ESOPD. All of the listed options are equal in their ability to accomplish the founder’s objective

Answer 1

Answer:

All the listed options are equal in their ability to accomplish the founder's objective.

Explanation:

The founder of the organisation has attained the age of retirement and has no children to continue with the management of the organisation, therefore a harvest strategy has to be carried out inorder to get value out of the business.

Harvesting strategy can be described as the discontinuation or reduction of the production of a particular product, it is carried out by entrepreneurs when they wish to exit a business. This strategy is carried out to extract the maximum amount of profit from the sales of the product in the market.