Succession Planning for Business Owners
Many business owners struggle with succession planning, whether you are too busy, you don’t like thinking about it, or you just aren’t yet ready to retire. But even if retirement isn’t on the immediate horizon, a good succession plan can make things cozy in the meantime, ensuring a safe backup plan for your clients, employees, and family members when the time finally arrives. Also, planning this out early can drastically increase the success of the transition.
When a business is ready to set up a well-structured succession plan, Summit is here to help you iron out the nitty gritty financial planning details.
Who’s Taking the Reigns?
The first thing to figure out is who exactly is going to run the business when you retire. Family members are a popular choice, especially if the business was started by the one who is retiring. But it’s good to consider whether this family member has the right skills and abilities to run the business and whether the decision will negatively impact any existing non-family employees. Any asset transfers between family or between you and the company should be clearly defined as well.
Selling the business outright can be a lucrative option, but it may upset relationships with current clients who have relied on you for a length of time.
Assess the Business’s Value
Particularly if you are planning to sell, business valuation can help you see your company’s current status and growth potential, so it is clearly evident to a potential buyer, and so you can increase these metrics for your own sake in the meantime and for a better outcome.
Asset and Revenue Breakdown
This is easy if you have your finances managed by Summit already. We’ll take inventory of all assets, assets under advisement, insurance, annuity, and healthcare.
Any recurring and nonrecurring revenue as well as any commissions the company receives should be taken into account so that you can see the current state of your business in order to plan not only for succession, but also for growth.
When it comes time to plan for retirement, there are a lot of questions to ask and details to sift through. Once you have a clear vision of what you want from your retirement, you can contact our local financial planners in Lafayette, IN to take care of these details, including succession planning for your business. You're sure to get the most out of your retirement and your business in the meantime when you partner with Summit for optimum financial and investment success.