Business succession planning is crucial for every business owner. Whether you want to retire soon or want to make sure your company lives on after your death, you should plan now to secure your legacy.
In owning your business, you have created something unique. With something so important, you need to examine all your options. Every situation is different, but here are some considerations.
Retirement may be far off, but it is still in your best interest to plan now. First, determine your goals for yourself and the business. Next, design a plan to help you get there. It may take you years to identify your successor and train him or her properly. If you plan to sell, you will appreciate the extra time to maximize your marketability and search for the ideal buyer.
Pass on the business
Perhaps creating a family business has been your dream from the start. Maybe you have found yourself leaning on a veteran employee more and more over the years. In any case, if you know who you want to take over after you leave, you should prepare your successor and the company.
Once you are sure the candidate is on board, communicate your intentions to key stakeholders. Gradually allow your successor to take on more responsibilities while you are there; this should help ease the transition when you are ready to leave.
Sell the company
In some cases, you may be better off selling the company, rather than grooming a successor. In that case, the business structure can affect how you proceed. You may prefer to find a buyer who wants to continue operating the firm, or you may find it easier sell off the assets individually. The decisions you make will have legal, financial and tax implications.