Do You Have a Succession Plan for Your Business? Here’s Why You Need One Now
Even if your planned retirement is years or decades away, it’s never too early to start thinking about succession planning for your business. This is especially true for a sole proprietorship or a closely-held family business. Is there a family member or key employee who may be interested in taking over? They may need time and your help to learn the skills needed for the job. Do you have a buy-sell agreement with your partners or co-owners, or will you sell or gift shares to a family member? Or will you sell your business to a third party?
If you’re planning on selling or gifting your business, you may need a business valuation to determine what it’s worth. What is it that gives your business value? Is it your own reputation for superior service? Can this be made into a system and taught to others? Do you have proprietary knowledge or patented methods? How do you compare to similar businesses? Is it chiefly your revenues or your profitability that makes your business more (or less) valuable than competitors? By focusing now on improving the value drivers in your business, you’ll get the best price when you do sell. And you’ll likely improve your bottom line now.
We can help you put together a plan to minimize any nasty tax consequences and fulfill your needs for business continuity. Call our office so we can help you with the best strategy for your business.