31 Mar 10 Things I Know About Succession Planning
10. It’s a process,?not a transaction.?Business succession or exit planning is about building a business that can succeed without its owner while preparing an owner to become independent — emotionally and financially — from the business.
9. You don’t have to leave.?One benefit of succession planning is that an owner is working to build a business to succeed without his or her daily involvement. It’s based on what an owner wants to achieve.
8. It creates business?value while you plan your life.?A business that can operate successfully without its owner becomes even more attractive to potential buyers.
7. It leads to owner independence.?One goal of succession planning is for an owner to become both emotionally and financially independent from the business. An owner must achieve both goals in this process.
6. It also includes?contingency planning.?If something were to happen to the owner tomorrow, you don’t want to have all of your long-term plans fall apart.
5. Key employees are critical.?You’ll need to keep key employees who can successfully operate the business without the owner’s daily management. They will need incentives to remain with the company, regardless of who the?owner is.
4. ‘Boomer’ owners can stay,?and still be free.?Business succession and exit planning is also for owners who plan to be involved in their businesses, in some capacity, into their Golden Years, while pursuing other endeavors.
3. It takes a team.?No one individual can do all of the planning. It will
require a team of the owner’s advisors — people with various skills — to help.
2. Only 3 paths: ?Sell, mentor, close. ?These are the only choices for a business owner. The good news is that all can be planned. Nothing has to be left to chance.
1. The sooner you plan, the more time you have to prepare.?The biggest asset an owner has is time; the more of it, the better.