FAMILY BUSINESS TRANSFERS
For the next 10 years, roughly 10,000 baby boomers will turn 65 every day (Source: Pew Research Center, 2011).
First generation family business owners are a rare and unique breed of entrepreneur. Typically, both spouses have worked long and hard for the family business. They have sacrificed much to grow the family business so as to leave a legacy to their family. However, when it comes time to begin the planning, they are always too busy. It seems they have no sense of mortality and many plan “to die on the job.” This places a tremendous burden on the heirs as they may not have sufficient liquid assets to pay any applicable estate and/or income taxes upon the death of the business owner, which may force liquidation of the business.
71% of small and mid-sized business owners plan to exit their business within the next 10 years. Yet, few business owners genuinely understand what actions they must take to achieve this goal (Source: Deloitte). Like the game of musical chairs, no one wants to be left standing while everyone else is comfortable. Are you ready to plan?
Click here to take you to a twenty question survey that is designed to provide a measurement of your readiness for a business transition based on your survey answers. If you use my email address, the information you provide will not be shared with any other parties without your permission.
Key Questions for Business Owners Ready to Exit
1. How ready am I to retire?
2. What resources do I need to retire?
3. What is my business worth if I left today?
4. What steps can I take to improve that?
5. What are my options?
Key Questions for Business Owners Not Ready to Exit
1. Have I begun to work on a business succession plan?
2. Do I have a Buy-Sell Agreement in place? If so, is it up-to-date?
3. How can I attract and retain quality managers?
4.How do I treat my children “equally” if one or more of them are involved in the business while one or more of them are not?
With the assistance of other professional advisors, I can help you reflect on where you stand with your readiness for a future business transition, evaluate your available options and customize solutions for your specific needs.
The skills of your advisors or the importance to your family of business succession planning are meaningless, unless you take action. The most important aspect of business succession planning is for the owners to become convinced that they need to take positive steps or have their family business disappear due to a lack of planning. Do not let that happen to your family business!