Many business owners fail to think about succession planning. However, there are benefits to succession planning that might not be obvious. We will explore a recent article in Accountancy Daily, “Succession Planning for Business Owners.” This article explains the benefits and wisdom of succession planning.
Accountancy Daily polled 500 SME owners. The poll uncovered a couple of interesting facts.
Fact #1: One-third of owners felt more confident about the future of their businesses when they had a coherent succession strategy.
Fact #2: 17% of respondents noted that succession planning actually brought them closer to their families.
The poll found that succession planning came with a variety of unexpected benefits. It is more than preparing to hand one’s business over to a new party.
Business owners often underestimate the level of effort and time needed to sell a business. Selling a business is usually a layered process that can even take years to complete. Business owners need to understand that in the time it takes to sell, their financial or personal situations may have changed, or the market may have changed. Selling can be a stressful and emotional process, which further complicates the matter.
For a lot of business owners, selling a business represents the single greatest financial move of their lives. Because of this, it is often accompanied with significant stress and anxiety. Don’t underestimate the emotional and psychological side of the sale. Proper planning years in advance for the sale of a business will help business owners avoid this stress.
A key part of the stress of selling a business is that business owners don’t know what comes next after selling. Developing a succession strategy is a way to think through such questions well in advance.
Another key aspect of succession planning is to make sure that your business is ready to sell. To receive the optimal price for your business, take the steps necessary to get your business in tip-top shape. This means diving into your books and records and getting everything in order. EBIT Associates can help you in this process.