Successful transitioning of your business to family members can mean the difference between being financially sound for life or potentially losing the value of many years of hard work. More than 70 per cent of family-owned businesses do not survive the transition from founder to second generation. They fall prey to either tax consequences or family discord. Developing and implementing a succession plan is essential to the long term success of the business you’ve worked so hard to grow.
Succession planning is also required where there is no likely family successor in the business. At some point in time you are going to need to exit the business, through retirement or sale. Succession planning covers the key steps to prepare the business for that moment. In the event of selling the business to a third party, we can manage the process on your behalf.
To maximise the value of your business you ultimately need to be constantly working ON the business with a view to selling it at some time in the future. Whether you do sell it or not is somewhat irrelevant, keeping that frame of mind means that at least you will always be in a position to sell it and realise it’s true value if you ever want or need to sell the business. That focus gives you a greater awareness of the need to systematise your business and make it less dependent on you.
Most people want to buy a business that works, not businesses that are run by people that work and work and work. Succession planning then is ongoing, an ever improving process and is just as much about working ON your business as planning the future. According to Michael Gerber, the secret is NOT to work in the business, it’s to work ON it so that you don’t have to work IN it. Sounds simple but most business owners are on a treadmill going nowhere.
If you're a committed and ambitious business owner looking to accelerate your business success we invite you to book a free, one hour introductory consultation to discuss your business needs. You'll get practical business, tax, marketing and financial advice designed to help you build your business and grow your wealth. To book a time, call us today on (03) 9497 2222 or complete your details in the box at the top of this page.