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5 steps for successful business succession planning

On Behalf of | Apr 17, 2020 | Estate Planning |

Whether your business has been in the family for generations, or you founded and built it up yourself, you likely want it to keep going after you retire or pass away. Of course, you want a smooth transition to new leadership you have faith in. That takes planning.

Business succession planning can be a complicated process, but if you take it step by step, with the help of an experienced estate planning attorney, you can preserve the company you have worked so hard to build. Here is a basic overview of thoughtful and comprehensive business succession planning in Florida:

  1. Determine your goals. Do you and your partners agree on what you want out of succession planning? For example, do you want to keep the business in your family’s hands, or would you consider bringing in outsiders as partners? Who will serve as advisors for the next generation of ownership while they gain experience?
  2. Establish a decision-making process. Once you have expressed your goals for the process, you need to create a process in which you involve family members in making decisions about the transition, as well as a method for resolving disputes.
  3. Establish a succession plan. Identify who will succeed you as owner, and who will manage the company. Make it clear what your relatives’ individual roles will be, both active and inactive, and how they will support the new ownership. Communicate the plan to your family.
  4. Create a business and owner estate plan. Address any tax implications, both for the business and your personal estate plan, and create a buy/sell agreement
  5. Decide on a succession plan. Specifically, will you give the business to the new owner(s) as a gift, or will you sell it to them? If it will be a sale, consider financing options.

A well-crafted succession plan can minimize family strife and give you confidence that your company will be in good hands in the future.