Owner dependence
Plain-English definition of owner dependence and why it affects business value.
What Owner dependence means
Owner dependence is the risk created when customers, decisions, quality, sales, systems or staff knowledge rely too heavily on the owner. It reduces transferability because a buyer, lender or manager may not be confident the business can perform without that person.
Why it matters
Reducing owner dependence can improve resilience, lender confidence and buyer confidence.
An example
If only the owner can quote jobs, manage key customers and solve staff problems, the business may be profitable but hard to hand over.