Business Succession Planning
Thoughtful owners of small businesses work hard to make their business a success but often fail to devote time to planning for the eventual transfer of their business interests to the next generation.
A well-crafted and comprehensive business succession plan (including a buy-sell agreement) is needed to deal with all the major issues that arise when transferring ownership of a business. For example, who is the appropriate successor to run the business following the business owner’s retirement or during the administration of the business owner’s estate?
A successful transition to the next generation requires comprehensive succession planning to make sure the business will be competently and efficiently run.
Develop & Implement A Business Plan
Brad Johnson can guide the business owner through the complex process of developing and implementing a comprehensive business succession plan to provide a smooth transition in both the ownership and management of their business enterprise.
Transferring Ownership
If you wish to keep the business in your family, you must have planned how you will support yourself in your retirement (whether through savings or by selling the business to your successor), and you undertake careful tax planning to ensure that taxes don’t force the business under. If you don’t wish to keep the business in the family, then you must work to find someone willing to pay a fair price for it. Transferring Management: This can be even more difficult, as it is often hard to find a successor with the zeal for running the business that was shared among the founder(s). Aging upper management staff must carefully train their subordinates to be ready to take over, otherwise the business may falter even after a successful transfer of ownership.
Transferring Management
This can be even more difficult, as it is often hard to find a successor with the zeal for running the business that was shared among the founder(s). Aging upper management staff must carefully train their subordinates to be ready to take over, otherwise the business may falter even after a successful transfer of ownership.
Key Areas of Concern
- Restrictions on transfer of ownership during lifetime
- Buy-sell arrangements upon the death of owners
- Buy-sell arrangements upon the happening of other events such as retirement, disability, termination of employment, deadlock among owners
- Valuation and establishing the purchase price of the owner’s interests
- Manner of payment of the purchase price of the owner’s interests
- Funding strategies, such as life insurance
- Management of the business