Succession Planning and Creating Exit Strategies
One day you will need or want to exit your business, through retirement or sale. Succession planning covers the key steps to prepare for that moment.
Simply put, succession planning is the process of transferring ownership from one group of owners and managers to another. Whether the transfer is to family members, key employees or third parties, the plan must align your personal, family and financial objectives.
Developing and implementing a well-designed succession plan and exit strategy is essential—whether your goal is to ensure the survival of a business from one generation to the next, or to maximize the after-tax proceeds from the sale of the business to a third party.
The planning can never start too early. Some decisions, such as the form in which you decide to do business, must be made early in the life of the business.
There is a lot that you can accomplish with the assistance of your tax, accounting and other advisors in order to increase the value of your business while you own it as well as when you transfer it. The return on an investment of time and resources in this area is often repaid to you many, many times over when it comes time to sell or transfer your business.