According to a recent survey conducted by the Canadian Federation of Independent Businesses (CFIB) only 24% of small businesses have a succession plan ready for when it’s time to retire. What happens when you want to leave the business is as important as how you run your business. Without a plan, all your hard work over the years may not reward you as you had hoped.
It’s never too early to start work on your plan. There are after all, many questions to be considered:
· Will you sell the business?
· Is there a family member to pass it on to?
· Do you want to retain an interest in the business?
· When is the best time to make the change?
· What legal and financial arrangements do you need to make?
· How will you involve staff in the transition?
None of these are questions that should be left to the last minute. Starting early gives business owners time to look at all the options and choose a course that will deliver the best outcome, not only for the future of the business but for the owner’s personal financial situation as well.
Succession plans all follow similar guidelines but as every business is unique, your plan will also be unique. To ensure you have all the information you need to make good choices it is always wise to consult a professional. Call us for an appointment if you’re ready to start planning your exit strategy from your business.
Succession planning assumes you are there to drive the process. But what if you were to die before retirement? What will happen then to your business assets and shares? How will your dependents manage? Estate planning lets you address those questions and map out a process that could be used if necessary. If you have a partner in your business make sure you both draw up an estate plan. Hopefully it will never be needed, but it will give you peace of mind in the meantime. If the plan is needed it will make a difficult time for your family a little easier.