Founders in food and beverage manufacturing have built some of the most resilient, recognisable, and community-rooted businesses in Australia, New Zealand and Canada.
But many now face a silent challenge: succession.
- In Canada, over 75% of SME owners expect to retire or exit by 2035 — yet most have no succession plan in place.
- In Australia and New Zealand, most F&B manufacturing SMEs are founder-dependent, with key IP, relationships, and processes concentrated in one person’s head.
- Trade sales rarely value the brand, team, and culture — and often lead to relocation or restructuring.
Meanwhile, the internal team — the people who actually run production, manage suppliers, and drive the business — are often overlooked as potential successors.
That’s a missed opportunity.
Why Food & Beverage Is Perfectly Suited to Internal Buyouts
F&B manufacturing is different from many other industries. It’s hands-on. Margin-conscious. Operationally intensive. And deeply tied to brand, product, and process.
That’s what makes it a prime candidate for employee- or management-led buyouts (ELBOs or MBOs).
1. Deep Operational Knowledge
Your plant manager or head of quality likely knows the batch codes, allergen protocols and shelf-life implications better than any external buyer ever will.
2. Predictable Cash Flow
Recurring supermarket orders, distribution contracts, or export deals often make for stable cash flow — ideal for vendor-financed or staged buyouts.
3. Asset-Backed Financing
Commercial kitchens, bottling lines, and warehousing space create lending flexibility — enabling bank or asset-based finance for the transaction.
4. Cultural & Regulatory Risk
Food safety certifications (HACCP, SQF, BRC) rely on process stability. Disruptive ownership changes can jeopardise compliance. Internal transitions avoid this risk.
5. Brand Value = Continuity
In consumer products, brand trust takes years to earn and minutes to lose. Keeping leadership and product philosophy intact is often more valuable than the sale price alone.
What Is an Employee-Led Buyout (ELBO)?
An ELBO is a structured succession pathway where the founder exits gradually — selling to internal leaders or employees through tools such as:
- Vendor finance — you’re paid out over time using business profits
- Asset-backed loans — supported by plant, stock or receivables
- Employee share schemes or trusts — often tailored to local tax and legal frameworks
- Hybrid models — combining employees with aligned capital partners
Important: Your team does not need personal wealth to buy the business.
The deal is funded through business performance and structure — not savings.
Real Case Snapshot (Anonymised – Australia)
Business: Third-generation bakery supplying independent grocers and café chains across NSW
Challenge: Founder (age 68) wanted to retire but didn’t want to sell to a competitor. Children not involved.
Solution: Structured MBO with Head of Operations and CFO, using:
- Vendor finance over 5 years
- Coaching and governance support for the new leadership team
- Structured share scheme for broader employee participation
Outcome:
- Staff retention improved
- Founder stepped back into a non-executive Chair role
- Supply chain partners praised the continuity
- The brand expanded into two new regional markets under new leadership
Source: Blue Harbour Capital engagement (anonymised)
Illustrative Example (New Zealand – Composite Based on Sector Patterns)
A premium snack food manufacturer with distribution across major NZ supermarkets wanted to explore succession options. The founder didn’t want to sell to a multinational buyer due to concerns over offshoring production and compromising product quality.
Instead, a phased ELBO was explored:
- A small group of long-serving employees (COO, Marketing Lead, Production Manager) became minority shareholders
- A discretionary trust was established for future employee participation
- The founder remained involved for 18 months, supporting brand strategy and retail relationships
Though illustrative, this model reflects the real decisions founders across F&B are making today: balancing financial return with legacy, culture and product integrity.
Why Founders Choose ELBOs in Food & Beverage
“I care who ends up in charge.”
You built the brand with purpose. Selling to just anyone feels wrong.
“My team already runs the business day-to-day.”
They just need structure, support and a path to ownership.
“I want value — but not at the cost of reputation.”
An ELBO delivers financial return while keeping your standards intact.
“I’m open to stepping back gradually — not disappearing overnight.”
You can stay on as Chair, mentor or brand voice during transition.
How Blue Harbour Capital Helps
At Blue Harbour Capital, we work with food and beverage founders across Australia, New Zealand and Canada to:
- Design employee- or management-led buyouts tailored to your business
- Structure vendor finance, bank support or hybrid ownership models
- Provide coaching and governance frameworks for the next generation of leaders
- Develop 100-day post-deal plans and KPI dashboards to ensure long-term success
- Align the deal to your financial needs, legacy goals, and team readiness
We’re not investors.
We don’t buy companies.
We help founders exit on their own terms — and make the transition work in practice.
Five Practical Steps to Start Your Succession Plan
- Clarify your goals
- Financial: How much do you need from the business?
- Personal: What’s your ideal role post-exit?
- Assess team readiness
- Who could lead? Who needs support?
- Get a business valuation
- Including assets, contracts, brand value and risks
- Explore structuring options
- Vendor finance, share schemes, trusts or capital partners
- Plan for transition success
- Leadership coaching, staff communication, supplier messaging, governance
Let’s Talk Succession in F&B
Whether you’re making oat milk, pasta, sauces, baked goods or beverages — the question is the same:
What happens when you stop showing up every morning at 5am?
If your answer isn’t clear yet, that’s normal. But it’s also the best time to start planning.
Get in touch for a confidential succession conversation.