The Importance of Business Succession PlanningThursday, September 8, 2016
Owning a business is considered the “American dream.” Whether you own a small, family-operated company or a large corporation, it’s important to plan ahead and make sure your business is prepared for the future.
What is business succession planning?
Business succession planning is the process of ensuring that there is a clear, well documented plan in place for replacing the owner and leadership team should certain circumstances occur, including illness, permanent disability, divorce, retirement or death.
Why is it important?
For many business owners, their company is their greatest asset. Ensuring not only that that the company continues to exist, but that it remains profitable should something happen to the owners or senior management is essential. Surprisingly, reports state that about 66 percent of businesses have not developed a succession plan.
Although succession may be an emotionally-charged topic, it’s an essential part of owning a business. A company runs the risk of going out of business completely, unless a detailed plan of succession is in place. While it may be a difficult time for all involved, a detailed plan for moving forward can help create a smoother, less stressful, transition, especially when the loss of a key individual is sudden.
In many cases, succession planning will involve the next generation of the business owner, and additional factors will come into play especially when not every member of the next generation is involved with the business. Care must be taken to ensure that the business succession plan is integrated with the business owner’s estate plan so that the business owner’s wishes with respect to all of his or her family is legally documented.
How can Trevett Cristo help?
The experienced business attorneys at Trevett Cristo will work closely with you to develop key documents needed for a smooth and successful ownership and management transition, and to integrate your business plan with your estate plan. No matter the type of business you have, Trevett Cristo is skilled in creating the necessary documents, such as shareholder agreements for corporations, operating agreements for limited liability companies and other succession planning and estate planning documents as may be required for your situation.
Protect your business. If you are in need for a business succession plan, get in touch with Trevett Cristo today.