As a business owner, are you starting to think about what’s going to happen to your company after you leave? Maybe you’re getting ready to retire. Maybe you’re making your estate plan and thinking about how you want to distribute assets. Your business is a major asset, and perhaps you want it to stay in the family.
The way that the business succession process unfolds will likely have a major bearing on how successful your company will be in the future. Here are some tips that can help you as you work through this process.
Don’t put it off
One important thing to keep in mind is that you’ll want to start this process early. If you’re going to retire later in 2023, you need to start immediately. But it’s best to start years before you’re actually going to leave the business. This allows you to take the time to consider your options and work on training your successor.
Consider everyone’s skills
When leaving your business to someone else, you really want to think about what skills they have and what they’re going to bring to the table. This is especially true if you have multiple heirs and you want them all to be involved. Try to give them different roles that utilize their skills and that will help them work together to be successful.
Talk to your heirs
Additionally, make sure that your heirs are part of the succession planning process. Find out if they want to take over the business. Ask them about what roles they may envision for themselves. Let them ask questions in advance. The more communication that happens, the smoother things are likely to go.
As you plan, remember that flexibility is key. You can create a plan and then update it or change it in the future. Nothing is written in stone. Your plan can shift and evolve over time, perhaps depending on how your heirs’ lives change. This is just another reason why starting early is important, because you can always update the plan to meet your evolving needs.
Succession planning is complex and it’s going to be different for every business owner. Seeking legal guidance proactively can help you to navigate this process successfully.