Selling or closing are not the only options if you choose to leave your business. Whether you run a business as a sole trader, partnership or company, a succession plan looks at who’ll take over once you’re gone.
You’ve built up your business and now you’re ready to move on — maybe into another venture or into retirement.
You may want to pass management or ownership of the business to your children or a trusted business partner. Or you might want to retain some ownership but take a back seat on day-to-day management. Whatever you choose, there’s a lot to consider.
And when it involves family it can get complicated, so it pays to take advice and plan well ahead.
If you’ve worked for years to build up your business, handing the reins to someone else may be furthest from your mind. Few owners have formal exit plans — if any — because:
There are serious risks if you don’t plan who’ll succeed you. Small businesses without succession plans often fail when their owners retire, get sick or die.
A solid succession plan is essential if you want your family business to carry on successfully after you leave it. The plan needs to identify which family members will take over or offer another management option.
This can be a tricky process, depending on your family relationships. Get your family involved as early as you can and seek professional advice.
Use this free template to help you write a great plan for launching your new business.
A business plan helps you set goals for your business, and plan how you’re going to reach them. When you’re starting out it’s a good idea to do a full and thorough business plan.
Quick-focus planning to make sure you work on the right things for your growing business - every day.
It’s important to take time to reflect on your business strategies and plan. It doesn’t have to be a difficult or time-consuming task.
You’ve decided to step back from your business, but you want to stay connected to it. There are several ways to do this:
It's a good idea to get advice for every stage of succession planning. How much advice you need depends on:
If you have a board of directors, it can help guide the planning process. You may also want to hire an advisor who specialises in succession planning.
Succession planning isn’t an exact science, but there are steps you should take: