Business Succession Plans
Business succession planning for your business is different from exit planning, but they go hand in hand. Exit planning refers to your strategy for getting the wealth out of your business. Your exit strategy is the way you choose to sell your business. Your exit plan might be an outright sale, an ESOP sale, a private equity infusion, a management buyout, a gifting program or some combination of these different techniques. Your exit plan is designed to cash you out of all or part of your business.
Creating a business success plan is the process by which you make sure that the business procedures and personnel you have put in place will support your exit strategy. For example, if you choose to sell your business to a third party, they will be interested in the individual employees who will make sure that marketing, sales, production and administration will continue to produce income after you leave. In addition, if you sell to an ESOP or to a private equity group it will be important to determine who will continue to provide the critical vision and leadership for the future that you have provided in the past. The specific elements of business succession plans vary with the unique needs of your business and with the exit strategy you choose.
Experienced Company Succession Planning Attorney
What happens when a business does not prepare for succession?
The following occur with regularity: (1) businesses cease operations, (2) families lose their entire investment, (3) employees lose jobs, and (4) communities lose their tax base. With company succession planning, however, it doesn’t have to be this way.
Owners should create a company succession plan as early as age 50 (maybe even earlier). Such planning can ensure the continuation of operations while also ensuring asset liquidity for the owner upon retirement. A thoughtful company succession plan will consider ownership transfer, management succession, and legacy planning.
Business Succession Plan Advisors
A little preparation can ensure that the owner has sufficient asset liquidity upon retirement and that the business will carry on for future generations. Your exit from your business will produce a higher value for you if you have a good business succession plan. The ESOP Plus® team can help you find dispassionate and knowledgeable business advisors with financial, human resource, production and marketing expertise who can guide you as you build the best business succession strategy for your company.