Many people start family businesses both so that they can be their own boss and so that they can pass down a legacy for their family. The business may take hours of work, but it can be worth it if it can help your family in the long run.
As you start to think about retirement and estate planning, it is essential to consider who will run the family business. A well-chosen successor can support your company and your family for the next generation.
Here’s what you should think about as you are considering who will operate the business after you.
It’s never too early to start thinking about succession planning
For many, choosing who will take over the business when they pass away is something they do not want to think about. It is often a decision that business owners want to put off for another day.
When you start planning early, you can ensure that your successor will have the training and preparation they need to maintain your business standards. While you may have built a successful business without specific training, you could guide your successor down a path for them to feel prepared when it is time to take over.
Be open about your planning
If there are multiple people, possible successors, in your family, talk to them about what it would take for them to be prepared to take over the business. You may find that the person you were planning on passing the business to is not interested in taking over.
Start training early
When you start your succession planning early, you can guide the next owner through the process of being prepared to take over the business. This is an opportunity to let them see daily operations, such as:
- Sales and support
- Accounting and other bookkeeping
- Management of personnel
Your current employees should regularly see your successor so that they are confident in their future leader and their qualifications to operate the business successfully.
Creating a succession plan is essential for the continuation of your business. You may need to talk to a skilled attorney to help you develop a plan that fits your needs.