If you have spent a large portion of your life building a successful business, one day you may wish to pass it on to your children or grandchildren.
However, just as building a business from the ground up is no easy feat, passing on a business to the next generation isn’t without challenges. In fact, it requires stringent planning and judgment, as well as the assistance of an experienced adviser who can help guide you through the process step-by-step.
Rotherham Taylor has helped hundreds of multi-generation businesses with the complex issue of succession planning over the years. Below are some of the key points we believe businesses ought to consider when it comes to succession planning:
Take time to plan
We recommend that businesses have short, medium and long-term plans for succession that include provisions for a sudden illness or death.
We have experience of many businesses that leave their planning until it’s too late, with consequential adverse effects on the success and cost of succession.
Business owners should never automatically assume that the next generation will want to take on the business.
Too many owners of family firms expect their son, daughter, brother, nephews or nieces to take over the business when they retire, without properly consulting them.
Owners should hold an open and honest discussion with them about whether they are interested in running the company.
Seek training and qualifications
Too many businesses are handed over to inexperienced or underqualified family members, which is why we recommend treating a family member as any other employee.
This means taking time to invest further in their training where necessary or suggest that they seek experience outside of the business first.
Look at other talents in the business
Owners sometimes fail to spot senior managers who may be more suited to running the business.
It is important to remember to look outside the family, too, when considering who might be the best person to take the reins.
To find out more about how Rotherham Taylor can help you with succession planning, please get in touch today.