How Can Family Businesses Plan Early to Improve Sales Potential with Pete Becchina

Welcome to the B2B Growth Blueprint podcast, where we talk with entrepreneurs, founders, and leaders at B2B services, tech, and SaaS companies to learn the systems and processes they've used to create success for their business. We'll also learn from marketing and sales experts to provide insights to help you grow your business. I'm your host, Mark Osborne, and the podcast is brought to you by Modern Revenue Strategies and their 10X ROI B2B Growth Guarantee. Schedule a free diagnostic call to learn the fastest path to double your B2B revenues in just 90 days. Hello and welcome to another episode of the B2B Growth Blueprint Podcast. I'm your host, Mark Osborne. And today, I'm very excited to welcome my guest, Pete Bacina. Now, Pete is a Certified Exit Planning Advisor. He's a business broker, a franchise consultant, and commercial real estate advisor who specializes in guiding family-owned businesses through every phase of entrepreneurship, from launching, scaling, exiting, and even preparing for and ensuring their legacy. He's the founder of Nicklin Consulting, and in that role, he helps owners unlock the wealth trapped in their businesses, prepare for profitable exits, and prefer— preserve their legacy for the next generation. His work blends business advisory, strategic deal-making, and family succession planning to ensure business owners achieve both the financial freedom and personal fulfillment that they're looking for. Pete draws on his own experience as a second-generation entrepreneur, a former restaurant owner, and trusted advisor to family businesses. His mission is simple: help owners build enterprises that last, businesses rooted in power, principle, and precision. So, Peter, welcome to the show.

Thank you so much, Mark. Looking forward to it. I'm looking forward to seeing how our collaboration between your thoughts on sustainable growth and how a business can exit are going to intertwine together.

Yeah, absolutely. So, you've obviously had a really interesting and diverse background. Why don't you give our audience a little bit of a picture of what you've done and what brought you to where you are today?

Absolutely. So I grew up in a family business. My parents immigrated here from Italy. They followed the typical plan of what happens with immigrations. They— my mom worked in a factory, my dad worked in construction. They saved up a little money, they bought a house, they bought a business while they still worked their jobs. And my sister, who's 15 years older than me, met her husband. He was in the pizza industry.

Okay.

He convinced my parents to sell everything in New York and take a shot buying a pizzeria in Philadelphia.

Okay.

So they did it. They did it on a whim. They moved to Pennsylvania. They bought a pizzeria in Philadelphia. 6 months later, we ended up buying a house in the suburbs, and they sold that pizzeria, bought a couple more. By the time I was 7 years old, 8 years old, I was standing on a milk crate answering the phones at the pizzeria. And I'll never forget it. This gentleman by the name of Mr. Gallo, he was one of our food distributors. And he would come in to get paid on his invoices and he would take out this wad of cash and he would peel back a couple bills and he'd take a $5 bill and he'd stick it in my pocket and he'd say to me, every time I see you here working, you're going to get an extra tip. And for whatever reason, that clicked for me, right? I just, I felt like, you know, having a good work ethic was a good thing to do. And that started when I was young. I never had plans of going to college. They had a— they built a very successful pizzeria in the suburbs that I just thought I was going to walk into, which was a great plan for me in high school because I wasn't really book smart at the time. I didn't really care about school. I just wanted to make money.

Okay.

And coming home one afternoon from junior year of high school, I walked in, saw my dad in tears, which I never saw before, and I wasn't sure what was happening. It was just time for a break. So they decided that they were not going to be business partners anymore. They put the pizzeria for sale the next day, and the day after, they had a buyer.

Wow.

So my parents retired. My sister and brother-in-law went and bought another pizzeria, and I was kind of left not sure what to do after I graduated high school. Luckily, my parents said to me that if I wanted to join my sister and brother-in-law, they would help support me to potentially buy another pizzeria with them. Um, so I talked to my brother-in-law and my sister, and they were okay with that. They liked the idea. And so I graduated high school, and 2 weeks later I was working 7 days a week in my brother-in-law's pizzeria. Um, 6 months later, I bought a third partnership into it. It was him and his brother at the time. My parents put up the money for me to buy a third of it. A year later, I bought his brother out, and we were 50/50 partners. From there, we went on. They grew to 7 pizzerias. I had a couple of them. We bought a restaurant with a liquor license and a full, full kitchen together as well. We own that property. So for almost 18 years, I was involved in family business as far as the restaurants go. They still have a restaurant. Since then, I got involved in multiple different businesses, so I've owned title insurance business. I've owned and I'm still partners in multiple real estate businesses. I even had a partnership in a record production company at one point, which failed miserably but was a lot of fun. So, um, I've just been part of business ownership from the time I was 18 to today. I'm 50. So I love every aspect of it.

That's super interesting. And, and tell us a little bit about what you spend your time on today with You know, with the certified exit planning and, and how you help business owners today.

Yeah, so that's all kind of morphed. I started, um, in just residential real estate probably 13 years ago, uh, going on 13 years now, and kept helping business owners and investors find either businesses or commercial properties that made sense for them, um, and was willing to and able to make the transition over time from residential real estate to commercial real estate.

Uh-huh.

And from there, kept finding myself focusing on business owners and helping business owners buy and sell businesses or buy and sell commercial properties that had to do with their business. And for whatever reason, probably because it's the energy I attract, I kept attracting family business owners.

Uh-huh.

And if you've ever been involved in any type of family business owner, you know it's chaos. It's always chaos. There's, there's just issues, there's family dynamics, there's just a lot of things happening. for the most part, the family unit wants to stay together. We were fortunate, you know, you know, we had the business breakup, but my family stayed together.

Mm-hmm.

And every once in a while I come across a family business that is teetering on that not being the case. And I do everything I can to jump in as an advisor and help pull that back together and help them create an outcome that sustains the family first and foremost, and ideally the business as well. And that just gives me a lot of purpose. So that is what drives me and that's where I end up deciding to focus on family businesses and the legacy piece of it as well. So we focus on 4 phases. We focus on number one, the launch, launching the business. Number 2, scaling and growth, which you're very familiar with obviously.

Mm-hmm.

Exiting, which would be the 3rd phase. And then we call legacy the 4th phase, but it's really the foundation for everything. It's what everything should be built on. So when I work with a business owner, I try and really understand where they are in the legacy piece. If they're pushing that off to the end, try and bring it back and make it forefront so that everything grows together rather than separately.

So that's really interesting. And you raised up a couple of things that I think are worth sort of underscoring and shining a light on, which is, you know, you talked about this sort of unexpected event when you were coming home from high school and, you know, You went from within 48 hours thinking you had sort of a future planned to a completely different. And many times I think business owners are so focused on growing the business for today and tomorrow and for perpetuity and not thinking about some of these things that could happen beyond their control, which might cause them to have to do some things that maybe they haven't prepared for versus—

Yeah.

you know, sort of preparing for some of those eventualities. You know, there's a joke, we're all going to exit sometime.

Yeah.

Whether— and I had Scott Snyder from the Exit Planning Institute on here not that long ago. And he was saying, you know, 50% of businesses will exit through an unplanned reason, either because death, divorce, disease, disability, disagreement, something is going to cause them to, you know, have an unplanned exit, which is crazy to think, you know. So, you know, of all the folks listening, you know, right now, half of you will, you know, likely have an unplanned exit from your business. And if you do some of the things that, you know, can be done to prepare for that exit in advance, you can really sort of help, you know, protect the value that you've created versus having that at risk. What are some of the things that, you know, you see that There are some mistakes that business owners sort of fail to do in not preparing for, you know, that transfer or even that sale or recapitalization or employee owner. Like, talk to us a little bit about that. Yeah.

So, I mean, we made all those mistakes, right? I mean, we grew for the sake of growth thinking, you know, more locations and everything else would be better. And we didn't have a plan for it. We didn't have systems. So, it just created chaos, right? So, I see that a lot of times. I see businesses trying to grow for the sake of growing, not realizing that it's actually eroding the value of the business because they're maybe discounting their pricing. So their margins are getting thinner. Buyers today, they don't want to see thinner margins just because it's a larger business. They want to see sustainable and consistent growth, right? So a couple of the main mistakes I see is not having a true understanding of what the value of your business actually is. You know, a lot of owners have an idea But the idea isn't really tied to reality. It's tied to maybe the number they think they need when they plan to retire. Maybe it's based on a rule of thumb that they heard from somebody, their accountant, maybe 20 years ago, and things have changed, whatever the case might be. So number one, the big mistake, not having a true value for your business.

Yeah.

Number 2 is not identifying the risks and not de-risking the business. You know, let's say you have a— you're an owner who has a really powerful business and it's all based on your personal relationships. Well, if you exit either through a sale or, God forbid, something worse, those relationships may not stay, and then the business erodes, right?

Right.

So that's a huge factor, understanding how to de-risk, uh, the, the issues in the business. But then the third part is the part that I think a lot of businesses that have kids, this is where they have their biggest mistake. A lot of times the owner— and we're talking primarily about baby boomers here— think, my kids are just going to take over the business.

Right.

They never ask their kids, number one, do you want the business? Number two, if you do, how do you plan on paying for it? Are you going to pay for it? Because maybe the kid thinks that they're just going to be handed the business. Maybe the owner thinks they're just gonna hand the business to their children and not properly plan for retirement that way. Maybe the children don't want the business at all, or maybe they have a completely different vision on how the business should be run, right? And not having that conversation early on creates a lot of issues, creates a lot of fire sales and distressed sales, creates a lot of businesses closing down that could have actually been saleable. So, not starting that process early on, I think, really hurts a lot of businesses.

So, you raised some really important things there that I, you know, that are worth kind of double-clicking on. And the first is, you know, the idea of growth for the sake of growth. And, you know, there's, you know, very often just this belief a bigger business is a better business. You know, businesses are like sharks. They have to constantly move forward and grow or They're going to die. And that's not always true because there's actually growth available through improving systems and processes that improve your profitability and your margin and your EBITDA. And really having an understanding. And, you know, you talked about, you know, sort of multi, you know, multi-location restaurants in the retail space or restaurant space.

Yeah.

Uh, that, that you're operating in. Very often a good buyer is someone who, you know, operates in one part geographically, uh, when you operate in another part.

Mm-hmm.

And if you've thought through, hey, one of those people might be a good buyer of my, uh, business, and then strategically expanded into areas that are noncompetitive, well, you've made your business more attractive to them. If you haven't thought that through, and then when it comes time to buy, they go, well, this location or this location, I'm just going to have to shut down because they're competitive with me. Oh, wow. If you had all that time and resources back that you put into building those locations, what else could you have done with your business?

Absolutely. And a lot of times it's, it's also done for metrics, right?

That's right.

And that's, that's sad because an ego gets in the way, but We're human and we all have some level of that. And we hear business owners all the time talking about, you know, the level of sales that they have, the level of growth that they have, but does it really translate to profitability? Does it really translate to a system like you mentioned, right?

Right.

Because a business without a system is not worth anything. So if you are the main, and sometimes I hear business owners say with such pride, like, no one can do it better than me, or if I wasn't here, this business wouldn't survive. It's not a business.

Right.

It's a job, sometimes a high-paying job, sometimes not, but it's just a job and it's not saleable. Today's buyers, they want to see a business that has profitability, sustainability, consistent growth. Doesn't have to be wild growth, just consistent growth, right? Something that looks normal for the industry and the ability for the business to continue on without the founder being there. Without that, They don't have anything to sell.

Well, and that underscores something that's really important too, which is that, you know, there's a phrase that the Exit Planning Institute likes to throw around, but I think it's very true, which is, you know, good exit planning is actually just good business planning. And running your business as if it's ready to sell is actually just a good way to run your business. And you hit on some of those key points right there, which is You know, think about owner dependency. If the business is dependent on you as the owner, it's not very sellable, not very transferable. It's also not that much fun to own and run because you can't take vacations, you can't enjoy yourself. You have to, you know, sort of be there or it won't run.

That's true.

The same thing, you know, is true with, you know, having systems in place. Without systems, it's all chaos and you're trying to figure it out all the time. But if it's a system that's scalable and repeatable, Well, then it's easier to run. Again, it can run without you. You can start to bring in other folks and even sort of build on it. But a lot of those things that I think business owners sort of mistakenly think of as, well, I'll get the business ready to sell one day. And I've heard it sort of said, like, people think of it like selling a house. Well, I'm going to live in the house until I'm ready to sell it. Then when I'm ready to sell it, I'll put the sign in the yard, I'll put a fresh coat of paint, I'll fix that loose board over on the, uh, stair, uh, and then it'll— and then it'll be good to go. But a business sale is much more involved than that, uh, and, and requires a lot longer, uh, to get some of those things in place.

Absolutely. I mean, the biggest key there is— and, you know, uh, through the CEPA designation, which is through Exit Planning Institute, they teach us about the gaps in a business, right?

Of course.

And there's 3 gaps typically. There's a profit gap, there's a value gap, and a wealth gap. And we look at the profit gap, the wealth gap, and the value gap together, but also individually, because a lot of times when a business owner's ready to walk out the door, usually one or more of those gaps are in place, and then they don't quite get the exit that they're looking for. So what happens is they may have to stay in the business longer, Which then emotionally plays on them and psychologically plays on them, and the business starts to deteriorate because they've already psychologically pulled away from it. Or they are forced to now have a different type of retirement based on the money they actually do receive for it, right? So all those factors play in. And to your point, yes, you should be planning from day one to create a built— a business that you are looking to exit, even if you never exited, even if it becomes a succession play with children or key employees or whatever the case might be.

So, you said something, and that's a super great point. And certainly something that everyone thinking or everyone listening that runs a business should be thinking of. Am I running a business that is as profitable or more profitable than the averages for my industry? Because that's that value gap. And is it— or profit gap— is it as valuable or more valuable than other businesses in my industry? Do I have the wealth that I need to retire, or can I extract it from the business? Because not having those things in place really sort of puts you at the mercy of the market and some external factors. But you mentioned something earlier that I want to come back to, which is This idea of building on the foundation of legacy and that very often, sometimes that sort of personal component of being ready to exit the business is missing because folks care about the legacy that they're leaving behind. Tell us a little bit about how you help companies manage that. And also, what are some things that folks listening today should be thinking about to ensure that they're protecting or building the legacy that they want to leave?

Yeah, that's a great point there because we say that legacy should be the foundation of the business, and that's because without our health— like, legacy includes health, relationships, mindset, separating our identity from the business. Too many business owners, their entire identity is their business, and once they sell their loss, right? So our purpose, all these type of things, what we want to be remembered for, that's all legacy. And that should all start from day 1 and start to be built from there. And part of the reason why I'm so passionate about that part is because I am still involved in my family's business, not as an owner, but as a stake— a non-stakeholder board of director for the family business.

Uh-huh.

And I got put in that position for a very sad reason. Out of nowhere, my brother-in-law earlier this year passed away, and he was fine one day and gone the next, young. And he managed to build an incredible business for my sister and her children and grandchildren, but that legacy stopped way too early, right? And part of it was because putting the business in front of And so had that have been different, he could still be here today building that legacy along with the rest of his family and building an incredible business. So, you know, I see that from a first-person perspective now. And they had a lot of the right systems and strategies in place, and yet they didn't have everything in place. And so with his passing, They went through 6 months of hell, of chaos, trying to renegotiate with the bank, all these other factors. Was there an insurance policy in play? Was it the right insurance policy? How does this work? How does that work? Was there a key person policy? There was not. All these type of things, right? So we are very fortunate because that family unit is very strong. We've all circled around each other to help everything move forward, and they're thriving still. But that's not always the case, and a lot of that can be prepared for ahead of time and taken into control ahead of time. So understanding, you know, what you want your business to look like, but also understanding what you want your life to look like outside of your business. Plan for that first and then have the business be built around that so that the business is funding your life and your lifestyle, not you working for your business, which we find to be the case way too many times, right? So that's a— It's a huge component of it.

So you've got so much kind of personal experience tied to what you do professionally and sort of all of the things that you've experienced really make you that much better of an advisor to businesses. And I'm curious, like, what are some of the gaps that you see, you know, businesses that they're sort of like, I'll figure all this stuff out on my own?

Yeah.

And then they finally have maybe some event that makes them realize that they can't, and they bring in an advisor like you. What are some of those common gaps, and what are some of the value propositions that advisors like yourself bring to those business owners?

Absolutely. So first and foremost is having a true understanding of what the business is worth. We touched a little bit on that earlier. Without a true understanding of where the business is today, And more importantly, how that business sits in relationship to best-in-class businesses in that industry is super important because that gap, right, that, that profit gap there that you're seeing, which creates a value gap, is where an advisor can really help them the earlier on they find where the gap is, right? So if we think that we're going to be exiting 5 years from now and we start evaluating that today, we have some runway to fix that gap and to increase what the multiple of the business will sell for.

That's right.

If you come to me today and say, I'm done, I want to be sold by the end of the year, we're in trouble, right? We're only going to get you, if anything, we're going to get you what the business is worth today, not what its potential would have been. So that's a big one. Number 2 is running improper books. And I don't mean, you know, fudging numbers. I mean, I travel and I put it on my business expense, you know, because we had talked about business. And I have a couple family members that really don't do a lot, but they're on The payroll and those type of things. Well, I come in as a buyer, I'm going to look at all that and say, what does this really mean? What's true here? What's, what's the real seller discretionary earnings or actual EBITDA at the end of the day, right? And if I'm getting financing, a bank is absolutely going to look at that. So then we have to start looking at, okay, what can we add back in? Well, banks don't want to see a lot of add-backs. That raises a lot of red flags. So let's get the books cleaned up. Much sooner so that we can present the proper picture and have both the buyer and the lender, if there's a lender involved, feel comfortable that this is a business worth investing in, not one that may not return the investment or even the principal at all.

Yeah.

Some of the big factors. Um, the last one that I do want to share is if there's a partnership in play, not having a buyout agreement and not having some type of insurance policy in place to help fund a buyout if, God forbid, something were to happen, like in the case of my brother-in-law, where if there was another partner there, the insurance policy could step in and play. But if there's 2 partners— I'm, I'm acting as a facilitator for a restaurant ownership family right now where everyone's healthy, but 2 partners want to go in separate directions and there's no plan in place for it. So because there's no plan in place for it, there's a lot of stress, there's a lot of animosity. So they brought me in to help defuse that and help create a plan to walk— work through that. And we will get there, and they're, they're in the process of doing that now. But I can promise you, if they didn't have the foresight to bring in a third party, whether it was me or someone else who could handle that for them, this would be a fire sale within 18 months, and someone would be getting a really good deal on a really nice property.

Yeah. Well, you're obviously an expert in a lot of really interesting topics and we could talk about it all day, but I got to be mindful of your time. But before I let you go, you know, sort of give us the pitch. Like, who do you work with? You've shared a lot of your expertise in, you know, sort of family businesses and retail, but who do you work with and what would be the best way to sort of engage and get in touch with you?

Absolutely. So we specialize in family businesses and family-owned businesses. We do want to help them through all 4 phases: the launch, the scale, the exit, and the legacy. So we can come in depending on where they are in the process and help them get to that final stage and start creating that legacy from day one. So we really work a lot with family businesses that are looking for some type of exit or succession, whether they're in great shape now or they know they're not in great shape and need to be in better shape. Great way to reach me is through our website. That's www.niclanconsulting.com, and, you know, be happy to have a 30-minute strategy call with someone and share what they're looking for to see if we can add value, because we won't work with someone if we don't think we can add value for them. And if we can't particularly add value, I have plenty of partners and referrers— referral partnerships that I can hopefully give them some type of value on.

Fantastic. Well, Pete, thank you so much for taking the time to join us today. I really enjoyed our conversation. I'm sure our audience learned a lot.

Thank you, Mark. Really appreciate it. I look forward to seeing how learning more about sustainable growth can be implied to family businesses, because I think the two go hand in hand. And I think if the businesses aren't looking at sustainable growth, they're just looking at growth, they're setting themselves up for failure. So I appreciate your time and expertise as well.

Absolutely. Talk to you soon.

Thanks. Take care.

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