With the release of its latest season on Hulu, "The Bear" will draw viewers into the heat of the kitchen, just in time for summer.
The show takes an inside look into what it is like to inherit a family business that is fraught with financial turmoil and a stubborn staff. How do you preserve a legacy amidst utter chaos and clashing beliefs?
Trust & Will takes a look at the valuable lessons in financial planning, estate management, and the balancing act between tradition and innovation.
"The Bear": A Quick Synopsis
Carmen "Carmy" Berzatto is an award-winning chef who works in Michelin-star restaurants in New York City.
Following his brother's tragic death, a suicide, he returns home to Chicago to manage the family-owned sandwich shop he inherited. The inheritance, however, is hardly served on a silver platter.
The show follows Carmy as he deals with his brother's unresolved debts, a hard-headed kitchen staff, and a substandard kitchen. He constantly butts heads and meets resistance on his mission to turn the shop into a first-class restaurant through innovative tactics such as reinventing the menu and running a brigade style kitchen. All this, while Carmy deals with his own grief caused by the loss of his brother and other family trauma.
"The Bear" paints a hilarious but grim picture of what it can be like to inherit a business that lacked a clear succession plan and financial plan. This guide will further explore these themes and the lessons we can take away from them.
What to Do When You Inherit a Dumpster Fire of a Family Business
According to Familybusiness.org, there are 24.2 million family businesses in the United States, which collectively employ 62 percent of the workforce. When you walk past your neighborhood deli, hair salon, or flower shop, you are hardly thinking about these businesses' financial futures or succession plans. However, this is a monumental issue that drives a significant portion of the national economy. The smooth transition of businesses from generation to generation not only impacts the owners, but also the family legacy, its employees, its customers, and its community.
In Carmy's case, however, he inherited what you could fairly call a dumpster fire of a business. The business itself was faltering, riddled with debt, and with disgruntled staff and customers. How is Carmy going to turn this place around to help preserve his family's legacy?
Managing Inherited Debt
When someone passes away, their debts do not simply disappear. Carmy discovers this harsh reality as he grapples with the financial mess left behind by his brother. As it turns out, his brother owed $300,000 to a family friend, "Uncle Jimmy," that came in the form of a personal loan.
Here are some tips on how to handle inherited debt:
Assessing the situation: Understanding the full scope of the debts and liabilities.
Prioritizing payments: Determining which debts need immediate attention and which can be managed over time.
Negotiating with creditors: Working with creditors to develop feasible repayment plans.
This is just scratching the surface on the topic. Be sure to check out some of our guides on what to do with inherited debt:
The Realities of Running a Family Business
Running a family business comes with unique challenges. As seen on the show, Carmy inherits a restaurant that is in shaky status. Amongst the pressing issues include financial instability, operational inefficiencies, and strained relationships. At the top of this list is the financial stress, a recurring theme in the show. This helps illustrate the pressures of maintaining a positive cash flow in any type of business. Here are some of the financial hurdles that Carmy faces:
Unpaid debts: Mikey left behind a significant debt of at least $300,000, which Carmy must pay back.
Operational costs: The daily expenses of running the restaurant often exceed its income.
Investment in improvements: Carmy needs to modernize the restaurant, requiring additional funds.
Effective cash flow management strategies are crucial for family businesses to stay afloat. These strategies include:
Regular financial reviews: Continuously monitoring financial health and making adjustments as needed.
Budgeting: Creating and adhering to a realistic budget to control expenses.
Seeking financial advice: Consulting financial experts to develop sustainable financial practices.
Touch Bistro provides a guide on optimizing cash flow, specific to family-owned restaurants like "The Original Beef of Chicagoland."
Honoring and Reinventing Your Family’s Legacy
A significant aspect of "The Bear" is Carmy's effort to honor his brother's legacy while also making necessary changes to keep the business afloat, and ultimately, the hope to turn it around completely. Carmy faces the challenge of respecting the restaurant's history while implementing new ideas to attract customers and improve operations. This balance between tradition and innovation is arguably essential for any family business. Here are some example strategies:
Preserving core values: Maintaining the essence and values that define the family business.
Innovating: Introducing modern practices, new recipes, and updated technologies to enhance the business.
Engaging with the community: Building relationships with the local community to ensure the business remains a cherished institution.
Estate Planning for Business Owners
One of the show's central themes is the importance of estate planning, succession planning, and financial planning for business owners. Carmy's brother, Mikey, leaves behind a restaurant in disarray, burdened with debt and mismanagement. Carmy is thrust into chaos with no guidance or plan whatsoever. Mikey seems to have premeditated his own death, but he unfortunately did not have the foresight to leave instruction behind of any kind, let alone a business succession plan.
Having a comprehensive estate plan in place ensures that your business and personal assets are managed and distributed according to your wishes. For business owners, this includes:
Designating a successor: Ensuring that someone capable and trustworthy is appointed to manage the business.
Detailing business operations: Providing instructions on daily operations to avoid confusion and disruption.
Addressing debts and liabilities: Outlining how outstanding debts will be managed or paid off.
Beware "The Bear," a Cautionary Tale
Humor is often used to mask harsh realities. While a viewer may find "The Bear" entertaining, the realities of the themes portrayed in the show are cringe-worthy. Unfortunately, the passing on of family businesses often don't go smoothly. The show offers a powerful narrative on the intricacies of managing a family business and legacy. It also underscores the importance of estate planning, succession planning, effective financial management, and balancing innovation with tradition. By learning from Carmy's plight, business owners can better prepare for the future, ensuring their legacies can continue on for generations to come.
At Trust & Will, we’re here to help keep things simple. You can create a fully customizable, state-specific estate plan from the comfort of your own home in just 20 minutes. Take our free quiz to see where you should get started, or compare our different estate planning and settlement options today!
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Image source: FX and Hulu.
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