Over the last year, every business owner has faced unprecedented challenges, from temporary closures to complying with new health and safety guidelines. In this environment, we are all reminded that there are no guarantees when it comes to running a business.
Because of this, owners would be wise to take stock of their plans for their future and their company’s future. Creating a solid business succession plan allows you to do this.
Succession planning involves determining what you want to happen with your business when you retire or pass away. Below are some tips for approaching this process.
- Don’t wait too long before making a plan. You may not be considering stepping down in the near future, but that does not mean your succession planning should be put on hold. Having a plan can instill peace of mind for you, your partners, your successor, and your employees if the unexpected happens.
- Do your homework. Your plan will reflect your wishes, but you should also identify replacement leaders, plan how to preserve assets, and determine what efforts will best move the business forward. These decisions often involve information you may not have right away, so doing your homework in these areas can be vital.
- Pick your successor wisely. Your successor could be a family member, a long-term employee, or someone outside the business. Whomever it is, this person will significantly impact your workforce, the reputation of the company, and the partnerships you have and hope to build. Thus, consider your choice carefully and prepare everyone accordingly.
- Work with legal professionals. You likely know your business inside and out; you may have been there from the first dollar it earned. However, when the time comes to make a succession plan, it can be crucial to work with an attorney. With legal guidance, you can be confident in the future of your business.
No one can predict the future, but you can plan for it. Establishing a framework to keep your company operational after you are gone can be one of the most valuable decisions you make as a business owner. Want to discuss your own succession plan? Contact attorney and founding partner, Mark Tebelius.