The apparent closure of the Loleta Bakery raises questions that a lot of us may not have thought about since we took our first business classes. Whether we were schooled at Stanford or by the SBDC, the one principle that applies to all businesses is that you need to have a successorship plan. It doesn’t have to be a long document but it should make clear what happens if one of the partners or family members becomes incapacitated or has to leave the business. It’s a standard part of any business plan. and no lender will release funds without one. One or even two illnesses shouldn’t shut down a business.
The chaos and confusion around the bakery’s closing leads me to conclude that there WAS no business plan. Since it’s impossible to get financing without a business plan I have to conclude further that the owners were wealthy enough to open the business without third-party financing, and without a plan. Now 20 people are out of work and facing an uncertain future.
Loleta is not the only town to be invaded by outlanders with more money than sense. When they start businesses that thrive, it’s called investment. When they screw up, they cause a lot of grief to a lot of people. Here’s wishing the very best for the employees and the people of Loleta .
The other local closure, Big Louie’s in Eureka, has been free of the drama seen in Loleta. Harold Lawrence has been an exemplary corporate citizen, supportive of community causes and youth sports. I wish him the best, and really hope the franchise will reopen. Meanwhile, when you open your business, think ahead to the time when you may be incapacitated or worse. Your family and your employees deserve better than to be left drifting. A lot better.