After more than 70 years in business, People’s Leather Supplies Limited is closing its doors.
Not because of falling demand.
Not because margins collapsed.
Not because imports wiped it out.
It is closing because there is no one to take over.
The founder is gone.
The next generation lives overseas.
Long-serving employees are retiring.
Buyers hesitated.
Time ran out.
This story is not isolated. It is structural.
Across Jamaica and the wider Caribbean, thousands of profitable, cash-flowing small and mid-sized businesses face the same fate. Owners in their 60s and 70s are ready to retire. Their children do not want the business. Institutional buyers are often too large to care. And younger entrepreneurs are chasing startups instead of acquiring cash-flowing assets.
In the United States, this demographic shift is called the “Silver Tsunami.” By 2030, an estimated 75 million Baby Boomers will retire, many of whom own businesses. It is widely described as the largest intergenerational wealth transfer in history.
The Caribbean’s version may be smaller in scale — but proportionally just as significant.
The question is no longer whether this transition will happen.
The question is: Who will capture the value?
The Investment Thesis: Buying Revenue Instead of Building It
As a former Wall Street equities trader who later moved into private acquisitions, I learned one lesson quickly:
It is often safer to buy cash flow than to build it.
Startups promise scale.
Acquisitions deliver income.
Boomer-owned businesses typically offer:
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Established customer bases
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Operating systems and supplier relationships
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Predictable cash flow
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Real assets (property, inventory, goodwill)
Unlike venture-stage companies, they have already survived recessions, currency shocks, and competitive cycles.
But the window is narrow. Once the owner decides to close rather than sell — as in the case of People’s Leather Supplies — that value disappears permanently.
Acquisition Strategies: Not All Deals Are Equal
For Caribbean investors considering this opportunity, understanding acquisition structures is critical.
1. Traditional Leveraged Buyout (LBO)
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Buyer acquires a business using debt (often bank financing)
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Debt is repaid using the company’s future cash flow
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Buyer contributes equity upfront
Best suited for:
Profitable, stable businesses with strong historical earnings.
Risk:
Overleveraging in thin Caribbean credit markets where refinancing options are limited.
2. Seller Financing
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Owner finances part of the purchase price
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Payments are made over time from business earnings
Best suited for:
Owners who prioritise continuity over maximum sale price.
Advantage:
Aligns incentives and lowers upfront capital needs.
3. Minority Growth Acquisition
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Investor acquires a stake while founder stays involved
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Provides liquidity and succession runway
Best suited for:
Owners unsure about full exit but needing succession planning.
4. Search Fund Model
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An entrepreneur raises capital to acquire one business
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Investors back the searcher, not just the deal
Popular in the U.S. and increasingly in Latin America, this model has yet to scale meaningfully in the Caribbean — but it could.
The Brutal Lessons for Buyers
The Silver Tsunami is not free money.
1. Cash Flow Must Be Verified
Family-run businesses often blend personal and corporate expenses. Normalised earnings must be carefully reconstructed.
2. Governance May Be Informal
Many Caribbean SMEs lack formal controls, audited statements, or modern accounting systems. Due diligence is non-negotiable.
3. Talent Gaps Are Real
The biggest risk in the People’s Leather case was not revenue — it was succession. If key staff retire alongside the owner, knowledge walks out the door.
4. Cultural Transition Is Delicate
Employees loyal to founders may resist new leadership. Acquirers must manage legacy respectfully.
The Brutal Lessons for Sellers
Boomer owners face their own hard truths.
1. Succession Planning Cannot Be Last Minute
Waiting until retirement looms reduces negotiating power and buyer interest.
2. Informal Systems Depress Valuation
Businesses dependent entirely on the owner’s relationships trade at discounts.
3. Emotional Attachment Distorts Pricing
Owners often price based on effort invested, not market multiples.
In the Caribbean, many profitable SMEs sell for 2–4x annual earnings — sometimes less — if the owner needs a fast exit.
Time erodes leverage.
Why the Caribbean Is Uniquely Positioned
Unlike Silicon Valley ecosystems, Caribbean economies are relationship-driven and undercapitalised.
This creates inefficiency — and opportunity.
Banks are often conservative, but profitable businesses with real estate and strong cash flow are financeable.
Family offices and high-net-worth individuals searching for yield in low-growth environments may find acquisitions superior to passive equity investments.
Moreover, digitisation can unlock upside.
A leather supply store with loyal customers but no e-commerce platform is not obsolete — it is under-optimised.
The Wealth Transfer Few Are Discussing
While headlines focus on startup innovation and AI disruption, an entire generation of owners is quietly preparing to exit.
Every closed shop represents:
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Lost employment
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Lost tax revenue
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Lost generational wealth
But every acquired shop represents:
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Preserved jobs
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Stabilised supply chains
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Compounded capital
The smartest investors are not waiting for IPOs.
They are buying overlooked cash-flowing businesses at reasonable multiples and modernising them.
Businessuite Final Word: This Is Not a Retirement Crisis. It Is a Capital Allocation Test.
The Silver Tsunami is neither hype nor inevitability.
It is a structural transition.
For ambitious Caribbean operators willing to perform rigorous due diligence, negotiate creatively, and modernise operations, it may represent one of the most asymmetric opportunities of the next decade.
But this is not passive investing.
It demands:
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Operational competence
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Financial discipline
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Governance awareness
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Patience
The closure of People’s Leather Supplies is not just a nostalgic loss.
It is a signal.
While many chase startup dreams and speculative trades, the real opportunity may lie in buying businesses that already work — before they quietly disappear.
Because in markets, as in life, value rarely waits for those who hesitate.
BlackSlate Holdings Group Limited
