“Business succession planning is both necessary and beneficial,” Mark Cussen observes in Investopedia. But the process isn’t easy, as our Geyer Law estate planning attorneys know. Whether you’re the owner of a small family business or a large corporation, the sooner you think about who you want to own and manage your business when your time ends, the more peace of mind you can have about the future.
“Focus on the present and avoid worrying about the unknown future ” may be included in the list of “Uplifting Quotes”, but, as Cussen cautions, while business owners may decide when to cash out, developments, including disability or death might end up making the decision for them.
While succession planning may seem overwhelming, the process itself has value “in making sure you are operating your office in an efficient and effective manner,” the Presbyterian Church in Louisville assures those running church offices. “Having a succession plan in place provides peace of mind about the business you’ve worked so hard to build, America’s SBDC in Oregon tells small business owners.
It literally is never too soon to give thought to business succession planning, we know at Geyer Law. As we know from 25 years’ experience, having business succession conversations now can avoid costly disputes and pain later on. Yes, everyone who starts a business wants it to last a long time, with many envisioning the business continuing after their own retirement or even into future generations.
Key succession planning questions:
- If there are co-owners and one dies, will the ownership be automatically purchased by the other owner(s)? Where will the funding come from?
- Will people now working in the business become successor owners? If not, what training will be available to the successor(s)?
- If a partial owner of the business wants his/her family member(s) to be successor(s), how is that going to work with the existing co-owners?
- If only one – or some of – the children are to become owners, how will the inheritances be “equalized”?
- How will the business respond to unexpected events — not only the death or disability of the owner, but divorce or the departure of a key employee?
Here at Geyer Law, we facilitate in-person conferences to discuss these “what ifs” before they ever arise. In an effective succession plan, everyone has ample advance notice of what the plan is and what their role is likely to be.
– by Cara Chittenden, Attorney with Rebecca W. Geyer & Associates
