The longevity of a small business depends on a well-thought out succession plan. This can give peace of mind to the owner, his or her family, employees, and customers.
For a family business, the owner should evaluate who else can run the business and may need to look beyond family members as the business grows.
An experienced attorney can help the key stakeholders create a succession plan or review existing plans.
If you want to choose a successor, here is a basic how-to-guide to help you get started:
1) Think about who your successor should be. This is an important decision that shouldn’t be taken lightly, and should be on your radar at least 15 years before you expect to retire. Consider who within the business is most qualified to lead going forward. Get some professional guidance, especially if you have a family business, where emotions run high in transitions.
2) Create a timeline. Decide well in advance when the control of the business will shift to your successor. Be flexible and open to your successor’s suggestions and ideas for the business during the transition.
3) Set up a training plan. Define the main areas of the company, and give your successor time to work in all of them, from the highest executive level parts of the business to the most basic tasks. Work with your successor to strengthen his or her understanding in any areas of difficulty.
4) Lay out your own plans for retiring. Having a plan for your retirement will make succession much easier and give both your successor and other members of the team clarity about what’s next and when.
5) Execute the plan and exit. When the time comes, step aside to allow the next leader to take over.
Ross Law Firm Ltd. is very fortunate to have the best possible succession plan in place: Bob’s sons Patrick and Daniel who are excellent lawyers who care greatly about each of our clients!
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