Guest Columns

Perspective:
Industry Issues

Navigating generational transitions in dairy industry

Michael Schwantes

Michael Schwantes is president and CEO of Creative Business Services/CBS-Global, Green Bay, Wisconsin. He contributes this column exclusively for Cheese Market News®.

Too many owners in the dairy space are stuck in a familiar pattern: working in the business, day in and day out, without pausing to ask who’s going to take over when they step away. We see this every year — a business with real value, strong margins, good people — and no clear path forward. Eventually, time runs out.

And then you’re not negotiating from a position of strength.

If you own a dairy business and you’re over 60, it’s time to start being honest with yourself. Do you have a successor in place? Is there a plan — or is it all just “someday” thinking? Are you shaping your final chapter intentionally or letting circumstances write it for you?

• Family isn’t always the plan. And that’s OK

We get it. Many dairy operations are family run. Maybe the idea has always been to pass it down. But what if your kids don’t want it? What if they aren’t ready? Or worse, what if you’re making business decisions now based on keeping them happy later?

Hoping for a family handoff without a timeline, training plan or agreement in writing isn’t planning — it’s gambling. If they’re in, great. Start grooming them now. That includes mentorship, business education, leadership exposure and setting realistic expectations about the workload and risk. And if they’re not interested? It’s better to know sooner than later. That clarity gives you time to prepare a well-positioned exit.

• The founder-led transition: A quiet shift that’s picking up steam

More owners are selling to management teams, key employees or long-term operational leaders. These founder-led deals can work well, but only if the team has the horsepower to lead and the financing to pull it off. Without the right prep, you’re back to scrambling.

We often see owners stay on as a mentor for 12-24 months to smooth the handoff. That’s smart. But we’ve also seen deals fall apart because there was no clarity on control, decision rights or exit terms. Don’t leave it to chance. Get it on paper.

If this is your ideal path, start now: Identify your internal champions, assess their interest and capacity, and build a structure that gives them a shot while protecting your downside.

• If you’re thinking about a third-party sale, know what today’s buyers want

This is not the market from five years ago. Strategic buyers and private equity are still active, but they’re picky.

They want:

• A second layer of leadership ready to run day one.
• Clean, normalized financials.
• Customer diversification.
• Systems, not just people, that drive the business.

We’ve worked on transactions where the seller had great numbers but couldn’t articulate how the business would run post-exit. That raises red flags, slows down diligence and erodes value.

Owner dependence is one of the biggest killers of deal momentum. If the buyer believes the business can’t survive without you, they either walk or adjust the offer — and not in your favor.

• The emotional hang-up that kills deals

Owners tell us, “I’m just not ready.” That’s fine — until you’re forced to be. We’ve seen illness, burnout and family conflict take good businesses off the table.

The best owners get ahead of it. They don’t wait until they’re done to start planning. They start while they’re still energized, with a clear head and leverage in their corner. They build a process, not just an event.

A strong plan gives you options. You don’t have to commit to selling in 12 months — but if you’ve taken the right steps, you’ll be ready when the right buyer appears. Without prep, even a great offer can fall flat.

• Exit planning is a process, not a one-time decision

You can’t just wake up one day and decide to sell. It takes 12-36 months of prep — cleaning up books, reducing owner dependency, grooming leadership, documenting systems and maximizing earnings.
Think of it like tuning up a piece of equipment. If you’ve let it go too long, it takes longer to restore. But with some proactive maintenance, it performs at its best when you need it.

That prep may also include resolving legal or compliance risks, documenting key vendor and customer relationships, or removing personal expenses from the books. Buyers notice sloppiness. And in today’s environment, they don’t have to settle.

• Bottom line: Control the exit or the exit will control you

You’ve spent a lifetime building something. Don’t fumble the final play.

Whether you’re planning to pass the baton to your kids, key employees or an outside buyer, it’s time to put a plan in place. No more “someday.” No more guesswork. Start acting like the business is already for sale — even if the timeline is still flexible.

The best transitions are led by owners who engage advisors, set clear goals and manage the process on their terms. If that sounds like you, it might be time to stop working in your business and start working on your exit.
You don’t get to decide if your business will change hands — you only get to decide how ready you are when it does.

CMN

The views expressed by CMN’s guest columnists are their own opinions and do not necessarily reflect those of Cheese Market News®.

© 2025 Cheese Market News • Quarne Publishing, LLC • Legal Information • Online Privacy Policy • Terms and Conditions
Cheese Market News • Business/Advertising Office: P.O. Box 628254 • Middleton, WI 53562 • 608/831-6002
Cheese Market News • Editorial Office: 5315 Wall Street, Suite 100 • Madison, WI 53718 • 608/288-9090